TEXAS REGIONAL BANCSHARES, INC. EXECUTIVE INCENTIVE COMPENSATION PLAN

Exhibit 10.29

TEXAS REGIONAL BANCSHARES, INC.

EXECUTIVE  INCENTIVE  COMPENSATION  PLAN

                1.             Establishment.   Texas Regional Bancshares, Inc. (the “Company”) hereby establishes the Texas Regional Bancshares, Inc. Executive Incentive Compensation Plan (the “Plan”).

                2.             Background.  Section 162(m) of the Internal Revenue Code disallows federal income tax deductions for certain compensation in excess of $1 million per year paid to certain highly compensated executive officers of Texas Regional Bancshares, Inc. (the “Company”). Compensation that qualifies as “other performance-based compensation” is not subject to the $1,000,000 limit. One of the conditions necessary to qualify certain incentive awards as “other performance-based compensation” is that this Plan must be approved by the Texas Regional Bancshares, Inc. shareholders and every five years the material terms of the performance goals under which the awards are made must be disclosed to, and approved by, the shareholders before the incentive compensation is paid. The material terms of the performance goals that must be approved by the shareholders under Section 162(m) include the employees eligible to receive the performance-based compensation, a description of the business criteria on which each performance goal is based, and the maximum amount that could be paid to any individual employee to whom awards are made.

3.             Purpose.  The principal purpose of the Plan is to provide incentives and rewards to executive officers of the Company who have significant responsibility for the growth and success of the Company.

4.             Administration of the Plan.

                (a)           This Plan shall be administered by the Stock Option and Compensation Committee of the Board of Directors of the Company (the “Committee”).  The Committee shall at all times while this Plan is in effect be composed of two or more members of the Board of Directors who meet the requirement of being independent directors of the Company.

                (b)           The Committee shall have all of the powers and authority set forth in this Plan, and as otherwise required to make grants and otherwise administer this Plan.  The powers of the Committee include the authority (within the limitations described herein) to select the persons to be granted awards under this Plan, to determine the time when awards will be granted, to determine whether objectives and conditions for earning awards have been met, to determine when awards will be paid (such as, by way of example only, at the end of the award period or deferred to a future date or conditioned upon a future event), and to determine whether an award or payment of an award should be reduced or eliminated.

                (c)           The Committee shall have full power and authority to administer and interpret this Plan and to adopt such rules, regulations, agreements, guidelines and instruments for the administration of this Plan and for the conduct of its business as the Committee deems