The latest viewpoint ong anything, there have been after that legal https://elitecashadvance.com/loans/disability-payday-loans/ times or statutory amendments one incur to the products talked about in the thoughts.
General Municipal Law 10(3), 11(2): The fresh conditions off Standard Municipal Law 10(1)(h) you to restrict so you’re able to ninety days the word of a keen eligible letter away from borrowing from the bank granted since the coverage to have state government dumps and investment do not apply to an enthusiastic irrevocable page regarding credit issued because of the a qualifying government home loan financial.
Especially, you ask if the conditions of General Civil Rules 10(1)(h) you to basically restriction to help you 3 months the word regarding a keen qualified page out of borrowing approved while the cover getting state deposits and you can investment pertains to a keen irrevocable page away from credit awarded because of the a keen FHLB.
Standard Civil Rules 10 and you can eleven regulate new deposit and brief money off funds by local governing bodies, along with counties. Below General Civil Law ten and you will eleven, all of the deposits and you may assets in excess of the amount covered not as much as terms of one’s Federal Deposit Insurance Work 1 need to be secured according to General Municipal Laws 10(3) (Standard Municipal Law 10, 11).
This really is in reaction toward query regarding the use of a letter away from borrowing from the bank issued from the a federal financial financial (hereinafter FHLB) given that safety to have condition dumps
General Civil Law 10(3) brings several alternatives for securing like excessively wide variety, like the greet of an enthusiastic qualified page regarding borrowing, payable into local government, while the protection to the fee of just one hundred forty per cent, of your own aggregate amount of social deposits about state government, and you may decided interest (Standard Civil Law 10[c][i]). Qualified page regarding credit is set for this purpose overall Municipal Law 10(1)(h) to mean:
[A]n irrevocable letter of credit issued in favor of the local government for a term to not meet or exceed 90 days because of the 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).
Municipal Loans — Dumps and you can Financial investments (identity from an irrevocable page regarding borrowing approved because safety of the a qualifying government mortgage lender)
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 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 Municipal Law 10(3)(c) try amended inside the 2002, however, to help you specifically site this new invited because of the regional governing bodies away from an irrevocable page out of borrowing from the bank issued from the an enthusiastic FHLB in order to secure excess deposits (L 2002, ch 615, productive endment plus renumbered existing paragraph (c) off subdivision 3 of section 10, as the fresh subparagraph (c)(i).