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Bill

SB 279

SECURITIES: Provides relative to certificate of stocks and uncertificated shares of a financial institution. (8/1/26)

2026 Regular Session Introduced by Jay Morris

Allows banks and related entities to issue and convert to uncertificated (electronic) shares, with board-approved conversion and preserved shareholder rights.

Sent to the Governor by the Secretary of the Senate.
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Bill Summary · SB 279

Bill Summary: SB 279 (Louisiana, 2026 Regular Session)

Main purpose

SB 279 seeks to modernize how shares of financial institutions and related entities are documented and held by shareholders. It authorizes and facilitates the use of uncertificated (electronic/book-entry) shares, rather than requiring physical stock certificates, for banks, savings institutions, and their holding companies, with a process to convert existing certificated shares to uncertificated form.

Key provisions and changes

  • Amends and reenacts:
    • R.S. 6:255(A) and (G)
    • R.S. 6:1204
    • R.S. 12:1-625(A)
    • Adds R.S. 6:707(E)
  • Certificated vs. uncertificated shares (general framework):
    • Current law generally requires stock certificates unless the issuing corporation participates in the Direct Registration System (DRS) or similar book-entry systems.
    • SB 279 allows the board of directors of a corporation to authorize some or all shares to be issued as uncertificated shares (electronic records, book-entry systems, etc.), with the authorization not affecting already issued certificated shares unless surrendered.
  • Conversion of shares:
    • The board may by a majority vote convert shares from certificated stock to uncertificated shares.
    • A process for conversion is established, specifying how and when certificated shares may be transitioned to uncertificated form.
  • Scope and applicability:
    • Applies to state-chartered banks and bank holding companies, capital stock associations and their holding companies, and state-chartered savings banks and their holding companies.
    • The uncertificated-share framework is intended to be applied in the same manner as other shares under the Business Corporation Act, while retaining the existing rights and obligations of shareholders regardless of certificate status.
  • Cross-references:
    • The bill maintains compatibility with the existing system for shares under the Business Corporation Act, ensuring that rights of shareholders remain consistent whether shares are certificated or uncertificated.
  • Effective date:
    • August 1, 2026.

Who/what would be affected

  • Financial institutions governed by Louisiana law:
    • State-chartered banks
    • Bank holding companies
    • Capital stock associations and their holding companies
    • State-chartered savings banks and their holding companies
  • These entities would have the option to issue uncertificated shares and convert existing certificated shares to uncertificated form, subject to board authorization and applicable procedures.

Procedural and timeline aspects

  • Effective date: August 1, 2026.
  • Legislative process milestones:
    • Passed the Senate (Yeas 35, Nays 0) and transmitted to the House prior to becoming law.
    • Referred to Committee on Commerce during consideration; expedited passage with favorable reports noted in the bill history.
  • Implementation considerations:
    • Requires corporate governance action (board authorization, majority vote) to issue or convert to uncertificated shares.
    • Establishes procedures for conversion to ensure a smooth transition from certificates to electronic records.

Practical impact and considerations

  • Administrative efficiency: Uncertificated shares can reduce paperwork, streamline transfer and record-keeping, and align with modern trading/book-entry systems.
  • Shareholder rights: SB 279 specifies that shareholder rights and obligations remain unchanged by the form of the share (certificate vs. uncertificated) unless otherwise stated.
  • Transition considerations: Institutions would need to manage the conversion process, update internal systems, and communicate changes to shareholders.

If you’d like, I can provide a side-by-side comparison of current law vs. SB 279 language to highlight exact changes, or a brief FAQ for stakeholders (shareholders, compliance officers, and investors).

Compiled from official sources — confirm details with the bill’s official record.

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