SECURITIES: Provides relative to certificate of stocks and uncertificated shares of a financial institution. (8/1/26)
Summary
SB 279 updates Louisiana law governing how shares of stock in certain financial institutions may be issued and documented. Under current law, shares generally must be represented by stock certificates unless the issuer participates in the Direct Registration System. The bill expands and clarifies that banks and related entities may issue shares as uncertificated shares, including through book-entry or other electronic methods, and it expressly allows a board of directors to authorize conversion from certificated to uncertificated shares by majority vote.
The bill applies these rules not only to general corporations under the Business Corporation Act, but specifically to state-chartered banks, bank holding companies, capital stock associations and their holding companies, and Louisiana state-chartered savings banks and their holding companies. It also preserves the rule that shareholders’ rights and obligations are the same whether shares are certificated or uncertificated, unless another law says otherwise. The measure amends existing statutes and adds a new provision to align financial-institution stock practices with modern electronic recordkeeping.
Impact
SB 279 changes Louisiana’s banking and corporate securities statutes to authorize uncertificated shares for covered financial institutions and their holding companies, and to recognize electronic book-entry systems as valid methods of documenting ownership. It amends R.S. 6:255 and 1204 and R.S. 12:1-625(A), and adds R.S. 6:707(E), thereby creating a specific statutory framework for banks and related entities to move away from paper stock certificates while preserving shareholder rights. The practical effect is to modernize stock administration, reduce reliance on physical certificates, and provide clearer authority for boards to convert existing certificated shares to uncertificated form.
Sentiment
The bill appears to have been broadly supported and noncontroversial. It passed the Senate unanimously, 35-0, and there is no committee transcript indicating opposition or significant debate. The lack of recorded dissent suggests the measure was viewed as a technical or modernization update rather than a contentious policy change.
Contention
No notable points of contention are reflected in the available record. The main policy choice in the bill is whether to allow financial institutions and their holding companies to use uncertificated shares and electronic book-entry systems, but the bill’s unanimous passage indicates little or no disagreement. Any potential concerns would likely have centered on corporate governance, shareholder recordkeeping, or the transition from paper certificates to electronic ownership records, but those issues are not shown as disputed in the available materials.