The view ong anything, there were subsequent legal instances otherwise statutory amendments that happen into situations discussed about opinion.
General Municipal Legislation 10(3), 11(2): The fresh conditions regarding General Municipal Legislation 10(1)(h) you to definitely restriction so you’re able to 90 days the expression regarding an enthusiastic qualified letter away from credit provided because the protection for state government dumps and assets dont affect a keen irrevocable letter regarding credit awarded by the a qualifying federal financial bank.
Especially, you ask whether or not the provisions from General Civil Law 10(1)(h) you to basically maximum to 90 days the definition of of a keen qualified letter out of borrowing issued once the security to have state government places and you can expenditures pertains to an irrevocable page regarding credit given by a keen FHLB.
Standard Municipal Law ten and 11 regulate the fresh deposit and short-term investment out of monies because of the regional governments, including counties. Around General Civil Laws 10 and 11, most of the places and you may opportunities in excess of extent covered lower than specifications of Government Put Insurance coverage Act step one should be secured in accordance with Standard Municipal Laws 10(3) (General Civil Legislation 10, 11).
This is certainly in response toward inquiry about your accessibility a letter from credit issued by the a national mortgage financial (hereinafter FHLB) as the defense getting state places
General Civil Legislation 10(3) provides multiple options for securing such as for example excessive number, including the acceptance out-of a keen eligible letter out-of borrowing, payable on state, given that defense with the commission of 1 hundred or so 40 percent, of one’s aggregate level of societal deposits on the local government, and you will arranged desire (General Municipal Law 10[c][i]). Eligible letter away from borrowing is defined for this specific purpose in general Municipal Laws 10(1)(h) to help you mean:
[A]n irrevocable letter of credit issued in favor of the local government for a term to not ever go beyond ninety days by a lender (other than the bank with which the money is being deposited or invested) whose commercial paper and other unsecured short-term debt obligations (or, in the case of a bank which is the principal subsidiary of a holding company, whose holding company’s commercial paper and other unsecured short-term debt obligations) are rated in one of the three highest rating categories (based on the credit of such bank or holding company) by at least one nationally recognized statistical rating organization or by a bank (other than the bank with which the money is being deposited or invested) that is [in compliance] with applicable federal minimum risk-based capital requirements (emphasis added).
Civil Money — Deposits and you can Investments (identity off an irrevocable page from borrowing provided just like the protection of the a being qualified government mortgage financial)
For purposes of General Municipal Law 10, a bank is defined to mean a national banking association (see 12 USC 21 et seq.) or a corporation, other than a trust company, organized under or subject to the provisions of article 3 of the New York State Banking Law (General Municipal Law 10[d]; Banking Law 2). FHLBs, which are supervised by the Federal Housing Finance Board, are separate regional corporations, owned by those savings and loan associations, cooperative banks, homestead associations, insurance companies, savings bank, and other insured depository institutions within the region that are eligible and have become members refinance personal loan? of the FHLB (12 USC 1422a, 1424, 1426, 1432). 2 As such, they do not fall within the definition of bank for purposes of acceptance of an eligible letter of credit under section 10 of the General Municipal Law.
General Civil Legislation 10(3)(c) are amended inside the 2002, however, in order to particularly resource the new greeting because of the local governments out of an enthusiastic irrevocable page out of borrowing provided by an enthusiastic FHLB so you’re able to secure excessive dumps (L 2002, ch 615, effective endment together with renumbered existing part (c) out of subdivision step three out of part ten, once the new subparagraph (c)(i).
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