The fresh viewpoint ong anything else, there are further judge cases otherwise legal amendments you to bear on activities talked about on the view.
Standard Municipal Legislation §§10(3), 11(2): The fresh terms regarding Standard Municipal Laws §10(1)(h) one limit to help you 3 months the definition of out-of a keen “qualified letter away from credit” awarded as the safeguards getting state government dumps and you may expenditures do not apply at a keen irrevocable page away from borrowing from the bank issued by the a being qualified government home loan lender.
Particularly, you ask perhaps the provisions of General Civil Legislation §10(1)(h) you to basically maximum so you’re able to 3 months the phrase regarding an enthusiastic “eligible letter away from borrowing” given because the protection to have state places and you can assets pertains to an irrevocable page out of credit approved of the a keen FHLB.
General Municipal Legislation §§10 and eleven regulate this new put and you will short-term capital out-of monies by regional governing bodies, in addition to counties. Under General Municipal Rules §§10 and eleven, most of the places and you may financial investments over the total amount covered below conditions of your own Federal Deposit Insurance Act step one have to be secure in accordance with General Municipal Legislation §10(3) (General Municipal Legislation §§ 10, 11).
That is responding into inquiry regarding the accessibility a letter from borrowing from the bank awarded by the a national mortgage bank (hereinafter “FHLB”) due to the fact protection to possess county dumps
General Civil Law §10(3) will bring numerous choices for securing particularly way too much quantity, including the allowed away from an enthusiastic “eligible letter out of borrowing”, payable into the local government, just like the safety “for the fee of just one hundred forty %, of your aggregate quantity of public dumps” regarding the local government, and you can decided notice (General Municipal Rules § 10[c][i]). “Qualified letter regarding borrowing from the bank” is placed for this reason typically Civil Rules §10(1)(h) so you’re able to suggest:
[A]n irrevocable letter of credit issued in favor of the local government for a term not to meet or exceed 90 days from the a bank (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 — Dumps and Opportunities (label regarding an irrevocable page out of credit given just like the shelter 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 installment loans in Kingston 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 Law § 10(3)(c) are revised within the 2002, yet not, to particularly reference brand new desired by local governments from an enthusiastic “irrevocable page off credit” issued by the a keen FHLB in order to safer an excessive amount of dumps (L 2002, ch 615, effective endment together with renumbered current part (c) away from subdivision 3 regarding point 10, due to the fact brand new subparagraph (c)(i).