Bank of Austin is one step closer to becoming the first new bank in Texas in nearly eight years.

The proposed bank’s application has been approved by the Texas Department of Banking. Its application with the Federal Deposit Insurance Corp. is still pending, though organizers hope to open this summer.

The bank, which plans to raise at least $31 million in capital, would target customers in Williamson and Travis counties.

Charles Cooper, Texas banking commissioner

“The formation of this new state bank is a very positive sign that community leaders and again seeing the advantage of a locally owned and managed financial institution,” Charles Cooper, Texas’ banking commissioner, said in a Tuesday press release.

The number of state charters in Texas has decreased by 28% since the financial crisis, to 464 institutions.

Organizers filed their application in December. Four of the de novo’s founders are directors at Bank of San Antonio, including J. Bruce Bugg Jr., who would be chairman of both banks. Jon Eckert, who has been a commercial banker with Comerica, would become president and CEO.

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Allison Prang

Allison Prang

Allison Prang is a reporter for American Banker, where she writes about community banks.