12C.22 REQUIRED COLLATERAL -- BANKS.
1. A bank shall pledge to the treasurer of state the amount of
collateral required under subsection 2 by depositing the collateral
in restricted accounts at a financial institution that has been
designated by the treasurer of state and that is not owned or
controlled directly or indirectly by the bank pledging the collateral
or any affiliate of the bank as defined in section 524.1101. Each
bank shall execute as debtor and deliver to the treasurer of state a
security agreement and such other documents, instruments, and
agreements in form approved by the treasurer of state as are required
to grant to the treasurer of state, as secured party in its capacity
as agent for the depositors of all public funds from time to time
deposited in the bank, a perfected security interest in the
collateral described in the security agreement. The security
agreement shall among other provisions contain all of the following
provisions:
a. A security interest in the collateral is granted as
collateral for the obligation of the bank to repay all uninsured
public funds deposited in the bank.
b. In the event an assessment is paid by a bank to the
treasurer of state pursuant to section 12C.23A, the bank is
subrogated to the claim of a public funds depositor to the extent the
claim is paid from funds paid by the bank.
c. The treasurer of state is appointed as agent of the bank
to assert the claim on behalf of the bank as subrogee. Any amount
recovered by the treasurer by reason of the claim shall be deposited
in the state sinking fund for public deposits in banks.
2. The amount of the collateral required to be pledged by a bank
shall at all times equal or exceed the total of the amount by which
the public funds deposits in the bank exceeds the total capital of
the bank. For purposes of this section, deposits that comply with
section 12B.10, subsection 7, that are evidenced either by one or
more certificates of deposit or one or more orders for the next
business day settlement and issuance of certificates of deposit, by a
federally insured bank or savings association other than the
depository, shall not be deemed public funds deposits in the bank or
savings association. For purposes of this chapter, unless the
context otherwise requires, "total capital of the bank" means its
tier one capital plus both of the following components of tier two
capital:
a. Qualifying subordinated debt and redeemable preferred
stock.
b. Cumulative perpetual preferred stock.
3. The amount of collateral pledged by an out-of-state bank that
operates a branch in Iowa shall be calculated in accordance with the
following formula:
a. Total deposits of the bank.
b. Total deposits in Iowa branches of the bank.
c. The total of paragraph "b" divided by the total of
paragraph "a", in order to establish the deposits of Iowa
branches as a percentage of total deposits.
d. Total capital of the bank as defined in subsection 2.
e. The total of paragraph "d" multiplied by the total of
paragraph "c", in order to establish Iowa branch capital.
f. Total public funds deposits in the bank.
g. The excess of the total of paragraph "f" over the
total of paragraph "e", if any.
4. The value of the collateral shall be its market value.
5. The treasurer of state shall adopt rules pursuant to chapter
17A to administer this section, including rules to do the following:
a. Designate not less than four financial institutions that
may be custodians of collateral pledged under this chapter and
establish regulations for qualification and compliance by the
custodians and remedies and sanctions for noncompliance by the
custodians.
b. Establish requirements for reporting to the treasurer of
state by a financial institution of the amount and value of
collateral held by the financial institution as custodian of
collateral for the uninsured public funds on deposit in a bank.
c. Establish procedures for the valuation of collateral that
does not have a readily ascertainable market value.
d. Establish procedures for adding collateral, releasing
collateral, and substituting different collateral for collateral
pledged under this section.
e. Establish procedures to determine the amount of the
uninsured public funds of each bank or branch of an out-of-state bank
as of the date of closing of a closed bank and the amount of the
assessment to be made upon each bank.
f. Establish additional procedures necessary to administer
this chapter and other rules as may be necessary to accomplish the
purposes of this chapter.
g. Provide forms and procedures for compliance with this
chapter, including electronic compliance.
h. Establish amounts and procedures for payment of fees to
cover the costs of administration of this chapter.
6. The collateral used to secure public deposits shall be in one
or more of the following forms acceptable to the treasurer of state:
a. Investment securities and shares in which a bank is
permitted to invest under section 524.901, subsections 1, 2, 3, and
4.
b. Investment securities, as defined in section 524.901,
subsection 1, paragraph "a", representing general obligations of
a state or a political subdivision of a state that is geographically
contiguous with the state, provided that such investment securities
are rated within the four highest grades according to a reputable
rating service or represent unrated issues of equivalent value.
c. Investment securities, as defined in section 524.901,
subsection 1, paragraph "a", representing general obligations of
a state or a political subdivision of a state that is not contiguous
with the state, provided that such investment securities are rated
within the two highest grades according to a reputable rating
service.
d. Nontransferable letters of credit upon which the payment
of principal and interest is fully secured or guaranteed by the
United States of America or an agency or instrumentality, including
government-sponsored enterprises of the United States of America.
e. Private insurance policies or bonds written by companies
approved by the superintendent.
7. A bank may borrow collateral to be pledged under subsection 2
if the collateral is free of any liens, security interests, claims,
or encumbrances.
Section History: Recent Form
2002 Acts, ch 1096, §8, 17; 2004 Acts, ch 1080, §1--3, 7; 2006
Acts, ch 1015, § 1; 2006 Acts, ch 1023, §5
Referred to in § 12C.23A, 12C.27
12C.22 REQUIRED COLLATERAL -- BANKS.
1. A bank shall pledge to the treasurer of state the amount of
collateral required under subsection 2 by depositing the collateral
in restricted accounts at a financial institution that has been
designated by the treasurer of state and that is not owned or
controlled directly or indirectly by the bank pledging the collateral
or any affiliate of the bank as defined in section 524.1101. Each
bank shall execute as debtor and deliver to the treasurer of state a
security agreement and such other documents, instruments, and
agreements in form approved by the treasurer of state as are required
to grant to the treasurer of state, as secured party in its capacity
as agent for the depositors of all public funds from time to time
deposited in the bank, a perfected security interest in the
collateral described in the security agreement. The security
agreement shall among other provisions contain all of the following
provisions:
a. A security interest in the collateral is granted as
collateral for the obligation of the bank to repay all uninsured
public funds deposited in the bank.
b. In the event an assessment is paid by a bank to the
treasurer of state pursuant to section 12C.23A, the bank is
subrogated to the claim of a public funds depositor to the extent the
claim is paid from funds paid by the bank.
c. The treasurer of state is appointed as agent of the bank
to assert the claim on behalf of the bank as subrogee. Any amount
recovered by the treasurer by reason of the claim shall be deposited
in the state sinking fund for public deposits in banks.
2. The amount of the collateral required to be pledged by a bank
shall at all times equal or exceed the total of the amount by which
the public funds deposits in the bank exceeds the total capital of
the bank. For purposes of this section, deposits that comply with
section 12B.10, subsection 7, that are evidenced either by one or
more certificates of deposit or one or more orders for the next
business day settlement and issuance of certificates of deposit, by a
federally insured bank or savings association other than the
depository, shall not be deemed public funds deposits in the bank or
savings association. For purposes of this chapter, unless the
context otherwise requires, "total capital of the bank" means its
tier one capital plus both of the following components of tier two
capital:
a. Qualifying subordinated debt and redeemable preferred
stock.
b. Cumulative perpetual preferred stock.
3. The amount of collateral pledged by an out-of-state bank that
operates a branch in Iowa shall be calculated in accordance with the
following formula:
a. Total deposits of the bank.
b. Total deposits in Iowa branches of the bank.
c. The total of paragraph "b" divided by the total of
paragraph "a", in order to establish the deposits of Iowa
branches as a percentage of total deposits.
d. Total capital of the bank as defined in subsection 2.
e. The total of paragraph "d" multiplied by the total of
paragraph "c", in order to establish Iowa branch capital.
f. Total public funds deposits in the bank.
g. The excess of the total of paragraph "f" over the
total of paragraph "e", if any.
4. The value of the collateral shall be its market value.
5. The treasurer of state shall adopt rules pursuant to chapter
17A to administer this section, including rules to do the following:
a. Designate not less than four financial institutions that
may be custodians of collateral pledged under this chapter and
establish regulations for qualification and compliance by the
custodians and remedies and sanctions for noncompliance by the
custodians.
b. Establish requirements for reporting to the treasurer of
state by a financial institution of the amount and value of
collateral held by the financial institution as custodian of
collateral for the uninsured public funds on deposit in a bank.
c. Establish procedures for the valuation of collateral that
does not have a readily ascertainable market value.
d. Establish procedures for adding collateral, releasing
collateral, and substituting different collateral for collateral
pledged under this section.
e. Establish procedures to determine the amount of the
uninsured public funds of each bank or branch of an out-of-state bank
as of the date of closing of a closed bank and the amount of the
assessment to be made upon each bank.
f. Establish additional procedures necessary to administer
this chapter and other rules as may be necessary to accomplish the
purposes of this chapter.
g. Provide forms and procedures for compliance with this
chapter, including electronic compliance.
h. Establish amounts and procedures for payment of fees to
cover the costs of administration of this chapter.
6. The collateral used to secure public deposits shall be in one
or more of the following forms acceptable to the treasurer of state:
a. Investment securities and shares in which a bank is
permitted to invest under section 524.901, subsections 1, 2, 3, and
4.
b. Investment securities, as defined in section 524.901,
subsection 1, paragraph "a", representing general obligations of
a state or a political subdivision of a state that is geographically
contiguous with the state, provided that such investment securities
are rated within the four highest grades according to a reputable
rating service or represent unrated issues of equivalent value.
c. Investment securities, as defined in section 524.901,
subsection 1, paragraph "a", representing general obligations of
a state or a political subdivision of a state that is not contiguous
with the state, provided that such investment securities are rated
within the two highest grades according to a reputable rating
service.
d. Nontransferable letters of credit upon which the payment
of principal and interest is fully secured or guaranteed by the
United States of America or an agency or instrumentality, including
government-sponsored enterprises of the United States of America.
e. Private insurance policies or bonds written by companies
approved by the superintendent.
7. A bank may borrow collateral to be pledged under subsection 2
if the collateral is free of any liens, security interests, claims,
or encumbrances.
Section History: Recent Form
2002 Acts, ch 1096, §8, 17; 2004 Acts, ch 1080, §1--3, 7; 2006
Acts, ch 1015, § 1; 2006 Acts, ch 1023, §5
Referred to in § 12C.23A, 12C.27
12C.22 REQUIRED COLLATERAL -- BANKS.
1. A bank shall pledge to the treasurer of state the amount of
collateral required under subsection 2 by depositing the collateral
in restricted accounts at a financial institution that has been
designated by the treasurer of state and that is not owned or
controlled directly or indirectly by the bank pledging the collateral
or any affiliate of the bank as defined in section 524.1101. Each
bank shall execute as debtor and deliver to the treasurer of state a
security agreement and such other documents, instruments, and
agreements in form approved by the treasurer of state as are required
to grant to the treasurer of state, as secured party in its capacity
as agent for the depositors of all public funds from time to time
deposited in the bank, a perfected security interest in the
collateral described in the security agreement. The security
agreement shall among other provisions contain all of the following
provisions:
a. A security interest in the collateral is granted as
collateral for the obligation of the bank to repay all uninsured
public funds deposited in the bank.
b. In the event an assessment is paid by a bank to the
treasurer of state pursuant to section 12C.23A, the bank is
subrogated to the claim of a public funds depositor to the extent the
claim is paid from funds paid by the bank.
c. The treasurer of state is appointed as agent of the bank
to assert the claim on behalf of the bank as subrogee. Any amount
recovered by the treasurer by reason of the claim shall be deposited
in the state sinking fund for public deposits in banks.
2. The amount of the collateral required to be pledged by a bank
shall at all times equal or exceed the total of the amount by which
the public funds deposits in the bank exceeds the total capital of
the bank. For purposes of this section, deposits that comply with
section 12B.10, subsection 7, that are evidenced either by one or
more certificates of deposit or one or more orders for the next
business day settlement and issuance of certificates of deposit, by a
federally insured bank or savings association other than the
depository, shall not be deemed public funds deposits in the bank or
savings association. For purposes of this chapter, unless the
context otherwise requires, "total capital of the bank" means its
tier one capital plus both of the following components of tier two
capital:
a. Qualifying subordinated debt and redeemable preferred
stock.
b. Cumulative perpetual preferred stock.
3. The amount of collateral pledged by an out-of-state bank that
operates a branch in Iowa shall be calculated in accordance with the
following formula:
a. Total deposits of the bank.
b. Total deposits in Iowa branches of the bank.
c. The total of paragraph "b" divided by the total of
paragraph "a", in order to establish the deposits of Iowa
branches as a percentage of total deposits.
d. Total capital of the bank as defined in subsection 2.
e. The total of paragraph "d" multiplied by the total of
paragraph "c", in order to establish Iowa branch capital.
f. Total public funds deposits in the bank.
g. The excess of the total of paragraph "f" over the
total of paragraph "e", if any.
4. The value of the collateral shall be its market value.
5. The treasurer of state shall adopt rules pursuant to chapter
17A to administer this section, including rules to do the following:
a. Designate not less than four financial institutions that
may be custodians of collateral pledged under this chapter and
establish regulations for qualification and compliance by the
custodians and remedies and sanctions for noncompliance by the
custodians.
b. Establish requirements for reporting to the treasurer of
state by a financial institution of the amount and value of
collateral held by the financial institution as custodian of
collateral for the uninsured public funds on deposit in a bank.
c. Establish procedures for the valuation of collateral that
does not have a readily ascertainable market value.
d. Establish procedures for adding collateral, releasing
collateral, and substituting different collateral for collateral
pledged under this section.
e. Establish procedures to determine the amount of the
uninsured public funds of each bank or branch of an out-of-state bank
as of the date of closing of a closed bank and the amount of the
assessment to be made upon each bank.
f. Establish additional procedures necessary to administer
this chapter and other rules as may be necessary to accomplish the
purposes of this chapter.
g. Provide forms and procedures for compliance with this
chapter, including electronic compliance.
h. Establish amounts and procedures for payment of fees to
cover the costs of administration of this chapter.
6. The collateral used to secure public deposits shall be in one
or more of the following forms acceptable to the treasurer of state:
a. Investment securities and shares in which a bank is
permitted to invest under section 524.901, subsections 1, 2, 3, and
4.
b. Investment securities, as defined in section 524.901,
subsection 1, paragraph "a", representing general obligations of
a state or a political subdivision of a state that is geographically
contiguous with the state, provided that such investment securities
are rated within the four highest grades according to a reputable
rating service or represent unrated issues of equivalent value.
c. Investment securities, as defined in section 524.901,
subsection 1, paragraph "a", representing general obligations of
a state or a political subdivision of a state that is not contiguous
with the state, provided that such investment securities are rated
within the two highest grades according to a reputable rating
service.
d. Nontransferable letters of credit upon which the payment
of principal and interest is fully secured or guaranteed by the
United States of America or an agency or instrumentality, including
government-sponsored enterprises of the United States of America.
e. Private insurance policies or bonds written by companies
approved by the superintendent.
7. A bank may borrow collateral to be pledged under subsection 2
if the collateral is free of any liens, security interests, claims,
or encumbrances.
Section History: Recent Form
2002 Acts, ch 1096, §8, 17; 2004 Acts, ch 1080, §1--3, 7; 2006
Acts, ch 1015, § 1; 2006 Acts, ch 1023, §5
Referred to in § 12C.23A, 12C.27
