This view represents the viewpoints of Work environment of your own County Comptroller at the time it had been rendered

The newest opinion ong anything, there are then legal instances or legal amendments one happen into the facts discussed regarding view.

General Civil Law 10(3), 11(2): The newest specifications out-of General Municipal Law 10(1)(h) one restrict in order to 3 months the phrase off a keen eligible letter from borrowing from the bank issued as the security to have state places and you can opportunities do not apply to an enthusiastic irrevocable letter away from borrowing from the bank given by a being qualified federal home loan bank.

Especially, you ask if the arrangements away from General Civil Laws 10(1)(h) you to fundamentally limit so you’re able to 90 days the phrase away from an enthusiastic eligible letter regarding borrowing approved because the shelter getting state government places and you will investments pertains to a keen irrevocable letter out of borrowing from the bank granted by the an FHLB.

Standard Civil Rules ten and you can eleven govern the newest deposit and you will brief capital away from funds by local governments, plus counties. Around Standard Civil Laws 10 and you can eleven, all of the dumps and you can investments in excess of the amount covered installment loan lender Hamilton KS below specifications of Federal Put Insurance rates Work step 1 should be secured according to General Municipal Rules 10(3) (Standard Civil Legislation 10, 11).

This really is responding to your inquiry regarding the usage of a page out of borrowing from the bank granted by the a federal mortgage bank (hereinafter FHLB) given that protection getting state deposits

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General Municipal Laws 10(3) will bring numerous alternatives for securing eg way too much quantity, including the greeting off an enthusiastic eligible page off credit, payable to your state, because safeguards toward commission of 1 hundred or so forty per cent, of the aggregate number of public deposits throughout the local government, and you can agreed upon focus (General Municipal Legislation 10[c][i]). Qualified letter from borrowing from the bank is set for this specific purpose generally Municipal Laws 10(1)(h) to help you mean:

[A]n irrevocable letter of credit issued in favor of the local government for an expression never to go beyond 90 days by a financial (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 Funds — Deposits and you can Expenditures (label out-of an irrevocable page off borrowing from the bank provided since the defense by the a being qualified federal home loan bank)

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.

Standard Civil Laws 10(3)(c) are amended inside the 2002, not, so you can particularly source the newest welcome because of the regional governments off an irrevocable page from borrowing issued because of the an FHLB so you can safe way too much deposits (L 2002, ch 615, energetic endment also renumbered existing part (c) of subdivision step 3 from section 10, just like the the new subparagraph (c)(i).

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