(a) Every financial institution subject to this chapter shall deposit with the general treasurer an amount that is at all times equal in value to twenty percent (20%) of the entire capital stock of the financial institution, in:
(1) Bonds, of at least a double A ("AA") rating or equivalent, of this state or of any state or of the United States;
(2) Bonds, rated at least double A ("AA") or equivalent, notes, or other financial obligations of any town or city in this state;
(3) Any securities of the classes in which the sinking fund commission of this state is authorized to invest the moneys received by it;
(4) First mortgages on improved real estate in this state of the class required for financial institution investments;
(5) Mortgages insured and debentures issued by the federal housing administration; or
(6) Obligations of national mortgage associations.
(b) These investments shall be held by the general treasurer as an additional security for the faithful performance by the financial institution of its duties as trustee, executor, custodian, conservator, guardian, assignee, or receiver, and also as an additional security for the repayment of deposits with the financial institution by executors, administrators, custodians, conservators, guardians, assignees, or receivers, or trustees on special agreement, made to exonerate the depositors under this title from personal liability to the estates on account of which these deposits were made. The parties intended to be secured by the deposits shall, in case of loss, be first fully indemnified out of the deposit, in preference to all other creditors of the financial institution. However, whenever the deposit or any part of it consists of mortgages on real estate, the financial institution so depositing it shall execute an assignment of the deposit and of the debts secured by it in favor of the general treasurer, in trust, for the uses and purposes listed in this section. No financial institution shall accept or assume to perform any of the trust duties mentioned in this section or receive any deposits from any of the trustees until the deposit has been made. If the security required by this section is one that is maintained in the Federal Reserve book entry system or the depository trust company book entry system or any similar entity, then the financial institution required to make the deposit shall designate the general treasurer as the pledgee of the security and provide written notification to the general treasurer identifying the security.
History of Section.
P.L. 1995, ch. 82, § 41.