The newest thoughts ong whatever else, there have been subsequent courtroom circumstances otherwise legal amendments one to incur to your facts chatted about regarding the thoughts.
Standard Municipal Law 10(3), 11(2): The brand new provisions regarding Standard Municipal Legislation 10(1)(h) one to limit so you can 3 months the term off an enthusiastic eligible page out-of borrowing from the bank issued just like the security for state government deposits and you can investments do not affect an enthusiastic irrevocable page out of borrowing issued of the a being qualified federal financial lender.
Specifically, you may well ask perhaps the specifications from Standard Civil Rules 10(1)(h) that essentially limit so you’re able to 90 days the definition of out-of a keen qualified page out-of borrowing approved because cover getting state government places and opportunities applies to an irrevocable page from borrowing from the bank awarded by a keen FHLB.
Standard Municipal Law ten and you may eleven govern the brand new deposit and you may short term capital from funds because of the local governments, including areas. Around Standard Civil Rules 10 and eleven, all dumps and you can financial investments in excess of the total amount covered around provisions of your Government Deposit Insurance policies Act step 1 should be shielded prior to Standard Civil Law 10(3) (General Municipal Rules ten, 11).
This is as a result on inquiry concerning your accessibility a letter off credit issued by the a federal home loan lender (hereinafter FHLB) once the coverage to possess condition dumps
General Municipal Law 10(3) brings several alternatives for protecting for example too much numbers, such as the invited of a keen qualified letter regarding borrowing from the bank, payable into the state, as the safety on commission of 1 hundred forty %, of aggregate quantity of societal places on state, and you may decided notice (General Civil Legislation 10[c][i]). Eligible page from borrowing is placed for this reason generally Municipal Rules 10(1)(h) to mean:
[A]n irrevocable letter of credit issued in favor of the local government for an expression not to surpass 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).
Civil Finance — Dumps and you will Opportunities (term from a keen irrevocable letter of borrowing approved since the shelter from the a being qualified federal financial 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 Rules 10(3)(c) try revised in 2002, yet not, in order to especially reference this new allowed because of the local governing bodies regarding a keen irrevocable letter out-of borrowing awarded flex credit loan reviews by the an FHLB so you’re able to secure an excessive amount of dumps (L 2002, ch 615, energetic endment also renumbered current section (c) out-of subdivision step 3 regarding area ten, since the latest subparagraph (c)(i).