Amended IN Senate March 27, 2017 CALIFORNIA LEGISLATURE 20172018 REGULAR SESSION Senate Bill No. 363Introduced by Committee on Banking and Financial Institutions (Senators Dodd (Chair), Galgiani, Hueso, Lara, Morrell, Portantino, and Vidak)February 14, 2017 An act to amend Section 22050.5 of the Financial Code, and to amend Sections 16305.8 and 16522 of the Government Code, relating to finance lenders. financial transactions.LEGISLATIVE COUNSEL'S DIGESTSB 363, as amended, Committee on Banking and Financial Institutions. California Finance Lenders Law. Financial transactions: loans and deposits.Existing(1) Existing law, the California Finance Lenders Law, provides for the licensure and regulation of finance lenders and brokers by the Commissioner of Business Oversight. Existing law, until January 1, 2022, provides that the law does not apply to any person who makes one loan in a specified period if that loan is a commercial loan, as defined. This bill would instead apply that exemption to a person who does not make more than one such loan in that specified period.(2) Existing law governing state funds provides that security is not required for that portion of any bank deposit or savings and loan association deposit that is insured under any law of the United States. Under existing law, to be eligible to receive and retain deposits, a bank or savings and loan association and credit union is required to deposit with the Treasurer as security for those deposits certain securities approved by the Treasurer in an amount in value of at least 10% in excess of the amount deposited with the bank or savings and loan association and credit union.This bill would provide that those provisions do not apply to deposits held by the Trustees of the California State University in one or more depository institutions located outside of the United States, if certain conditions are met.Existing law, for purposes of a bank being able to receive demand or time deposits of state funds, specifies which securities may be received, and includes within that list of eligible securities a letter of credit issued by the Federal Home Loan Bank of San Francisco that includes specified terms.This bill would require that in order for a letter of credit issued by the Federal Home Loan Bank of San Francisco to qualify as an eligible security for the purposes described above, that letter of credit must be in an amount in value of at least 100% of the amount deposited with the bank.Digest Key Vote: MAJORITY Appropriation: NO Fiscal Committee: NOYES Local Program: NO Bill TextThe people of the State of California do enact as follows:SECTION 1. Section 22050.5 of the Financial Code is amended to read:22050.5. (a) This division does not apply to any person who makes no more than one loan in a 12-month period if that loan is a commercial loan as defined in Section 22502.(b) This section shall remain in effect only until January 1, 2022, and as of that date is repealed.SEC. 2. Section 16305.8 of the Government Code is amended to read:16305.8. (a) Nothing in Sections 16305.3 to 16305.7, inclusive, shall apply to money drawn or collected by the Regents of the University of California.(b) Nothing in Sections 16520 to 16533, inclusive, and Sections 16610 to 16622, inclusive, shall apply to deposits held by the Trustees of the California State University in one or more depository institutions located outside of the United States if at least one of the following conditions is satisfied:(1) The amounts on deposit are insured under a foreign law.(2) The amounts on deposit that are not insured under a foreign law do not exceed one hundred thousand dollars ($100,000) per depository institution.SEC. 3. Section 16522 of the Government Code is amended to read:16522. The following securities may be received as security for demand and time deposits:(a) Bonds, notes, or other obligations of the United States, or those for which the faith and credit of the United States are pledged for the payment of principal and interest, including the guaranteed portions of small business administration loans, so long as those loans are obligations for which the faith and credit of the United States are pledged for the payment of principal and interest.(b) Notes or bonds or any obligations of a local public agency (as defined in the United States Housing Act of 1949) or any obligations of a public housing agency (as defined in the United States Housing Act of 1937) for which the faith and credit of the United States are pledged for the payment of principal and interest.(c) Bonds of this state or of any county, city, town, metropolitan water district, municipal utility district, municipal water district, bridge and highway district, flood control district, school district, water district, water conservation district or irrigation district within this state, and, in addition, revenue or tax anticipation notes, and revenue bonds payable solely out of the revenues from a revenue-producing property owned, controlled or operated by this state, or such local agency or district, or by a department, board, agency, or authority thereof.(d) Registered warrants of this state.(e) Bonds, consolidated bonds, collateral trust debentures, consolidated debentures, or other obligations issued by the United States Postal Service, federal land banks or federal intermediate credit banks established under the Federal Farm Loan Act, as amended, debentures and consolidated debentures issued by the Central Bank for Cooperatives and banks for cooperatives established under the Farm Credit Act of 1933, as amended, consolidated obligations of the Federal Home Loan Banks established under the Federal Home Loan Bank Act, bonds, debentures and other obligations of the Federal National Mortgage Association and of the Government National Mortgage Association established under the National Housing Act as amended, in the bonds of any federal home loan bank established under said act, bonds, debentures, and other obligations of the Federal Home Loan Mortgage Corporation established under the Emergency Home Finance Act of 1970, and in bonds, notes, and other obligations issued by the Tennessee Valley Authority under the Tennessee Valley Authority Act, as amended.(f) Bonds and notes of the California Housing Finance Agency issued pursuant to Chapter 7 (commencing with Section 41700) of Part 3 of Division 31 of the Health and Safety Code.(g) Promissory notes secured by first mortgages and first trust deeds upon residential real property located in California, provided that:(1) Notwithstanding Section 16521, the promissory notes shall at all times be in an amount in value at least 50 percent in excess of the amount deposited with the bank;(2) The Treasurer issues regulations, establishes procedures for determining the value of the promissory notes and develops standards necessary to protect the security of the deposits so collateralized;(3) The depository may exercise, enforce, or waive any right or power granted to it by promissory note, mortgage, or deed of trust; and(4) The following may not be used as security for deposits:(i) Any promissory note on which any payment is more than 90 days past due,(ii) Any promissory note secured by a mortgage or deed of trust as to which there is a lien prior to the mortgage or deed of trust, or(iii) Any promissory note secured by a mortgage or deed of trust as to which a notice of default has been recorded pursuant to Section 2924 of the Civil Code or an action has been commenced pursuant to Section 725a of the Code of Civil Procedure.(h) Bonds issued by the State of Israel.(i) Obligations issued, assumed, or guaranteed by the International Bank for Reconstruction and Development, the Inter-American Development Bank, the Asian Development Bank, the African Development Bank, the International Finance Corporation, or the Government Development Bank of Puerto Rico.(j) Any municipal securities, as defined by Section 3(a)(29) of the Securities Exchange Act of June 6, 1934, (15 U.S.C. 78, as amended), which are issued by this state or any local agency thereof.(k) Letters of credit issued by the Federal Home Loan Bank of San Francisco, which shall be in the form and shall contain provisions as the Treasurer may prescribe, and shall include the following terms:(1) The Treasurer shall be the beneficiary of the letter of credit.(2) The letter of credit shall be clean and irrevocable, and shall provide that the Treasurer may draw upon it up to the total amount in the event of the failure of the bank or if the bank refuses to permit the withdrawal of funds by the Treasurer or any other authorized state officer or employee.(3) Notwithstanding Section 16521, the letter of credit shall at all times be an amount in value of at least 100 percent of the amount deposited with the bank.(l) An eligible bank that has been selected by the Treasurer for the safekeeping of money belonging to, or in the custody of, the state, and that has its headquarters located outside of the state, may submit letters of credit that are drawn on its regional federal home loan bank as security, solely for deposits maintained in the Treasurers demand accounts, and subject to the terms set forth in paragraphs (1) and (2) to (3), inclusive, of subdivision (k).
Amended IN Senate March 27, 2017 CALIFORNIA LEGISLATURE 20172018 REGULAR SESSION Senate Bill No. 363Introduced by Committee on Banking and Financial Institutions (Senators Dodd (Chair), Galgiani, Hueso, Lara, Morrell, Portantino, and Vidak)February 14, 2017 An act to amend Section 22050.5 of the Financial Code, and to amend Sections 16305.8 and 16522 of the Government Code, relating to finance lenders. financial transactions.LEGISLATIVE COUNSEL'S DIGESTSB 363, as amended, Committee on Banking and Financial Institutions. California Finance Lenders Law. Financial transactions: loans and deposits.Existing(1) Existing law, the California Finance Lenders Law, provides for the licensure and regulation of finance lenders and brokers by the Commissioner of Business Oversight. Existing law, until January 1, 2022, provides that the law does not apply to any person who makes one loan in a specified period if that loan is a commercial loan, as defined. This bill would instead apply that exemption to a person who does not make more than one such loan in that specified period.(2) Existing law governing state funds provides that security is not required for that portion of any bank deposit or savings and loan association deposit that is insured under any law of the United States. Under existing law, to be eligible to receive and retain deposits, a bank or savings and loan association and credit union is required to deposit with the Treasurer as security for those deposits certain securities approved by the Treasurer in an amount in value of at least 10% in excess of the amount deposited with the bank or savings and loan association and credit union.This bill would provide that those provisions do not apply to deposits held by the Trustees of the California State University in one or more depository institutions located outside of the United States, if certain conditions are met.Existing law, for purposes of a bank being able to receive demand or time deposits of state funds, specifies which securities may be received, and includes within that list of eligible securities a letter of credit issued by the Federal Home Loan Bank of San Francisco that includes specified terms.This bill would require that in order for a letter of credit issued by the Federal Home Loan Bank of San Francisco to qualify as an eligible security for the purposes described above, that letter of credit must be in an amount in value of at least 100% of the amount deposited with the bank.Digest Key Vote: MAJORITY Appropriation: NO Fiscal Committee: NOYES Local Program: NO
Amended IN Senate March 27, 2017
Amended IN Senate March 27, 2017
CALIFORNIA LEGISLATURE 20172018 REGULAR SESSION
Senate Bill No. 363
Introduced by Committee on Banking and Financial Institutions (Senators Dodd (Chair), Galgiani, Hueso, Lara, Morrell, Portantino, and Vidak)February 14, 2017
Introduced by Committee on Banking and Financial Institutions (Senators Dodd (Chair), Galgiani, Hueso, Lara, Morrell, Portantino, and Vidak)
February 14, 2017
An act to amend Section 22050.5 of the Financial Code, and to amend Sections 16305.8 and 16522 of the Government Code, relating to finance lenders. financial transactions.
LEGISLATIVE COUNSEL'S DIGEST
## LEGISLATIVE COUNSEL'S DIGEST
SB 363, as amended, Committee on Banking and Financial Institutions. California Finance Lenders Law. Financial transactions: loans and deposits.
Existing(1) Existing law, the California Finance Lenders Law, provides for the licensure and regulation of finance lenders and brokers by the Commissioner of Business Oversight. Existing law, until January 1, 2022, provides that the law does not apply to any person who makes one loan in a specified period if that loan is a commercial loan, as defined. This bill would instead apply that exemption to a person who does not make more than one such loan in that specified period.(2) Existing law governing state funds provides that security is not required for that portion of any bank deposit or savings and loan association deposit that is insured under any law of the United States. Under existing law, to be eligible to receive and retain deposits, a bank or savings and loan association and credit union is required to deposit with the Treasurer as security for those deposits certain securities approved by the Treasurer in an amount in value of at least 10% in excess of the amount deposited with the bank or savings and loan association and credit union.This bill would provide that those provisions do not apply to deposits held by the Trustees of the California State University in one or more depository institutions located outside of the United States, if certain conditions are met.Existing law, for purposes of a bank being able to receive demand or time deposits of state funds, specifies which securities may be received, and includes within that list of eligible securities a letter of credit issued by the Federal Home Loan Bank of San Francisco that includes specified terms.This bill would require that in order for a letter of credit issued by the Federal Home Loan Bank of San Francisco to qualify as an eligible security for the purposes described above, that letter of credit must be in an amount in value of at least 100% of the amount deposited with the bank.
Existing
(1) Existing law, the California Finance Lenders Law, provides for the licensure and regulation of finance lenders and brokers by the Commissioner of Business Oversight. Existing law, until January 1, 2022, provides that the law does not apply to any person who makes one loan in a specified period if that loan is a commercial loan, as defined.
This bill would instead apply that exemption to a person who does not make more than one such loan in that specified period.
(2) Existing law governing state funds provides that security is not required for that portion of any bank deposit or savings and loan association deposit that is insured under any law of the United States. Under existing law, to be eligible to receive and retain deposits, a bank or savings and loan association and credit union is required to deposit with the Treasurer as security for those deposits certain securities approved by the Treasurer in an amount in value of at least 10% in excess of the amount deposited with the bank or savings and loan association and credit union.
This bill would provide that those provisions do not apply to deposits held by the Trustees of the California State University in one or more depository institutions located outside of the United States, if certain conditions are met.
Existing law, for purposes of a bank being able to receive demand or time deposits of state funds, specifies which securities may be received, and includes within that list of eligible securities a letter of credit issued by the Federal Home Loan Bank of San Francisco that includes specified terms.
This bill would require that in order for a letter of credit issued by the Federal Home Loan Bank of San Francisco to qualify as an eligible security for the purposes described above, that letter of credit must be in an amount in value of at least 100% of the amount deposited with the bank.
## Digest Key
## Bill Text
The people of the State of California do enact as follows:SECTION 1. Section 22050.5 of the Financial Code is amended to read:22050.5. (a) This division does not apply to any person who makes no more than one loan in a 12-month period if that loan is a commercial loan as defined in Section 22502.(b) This section shall remain in effect only until January 1, 2022, and as of that date is repealed.SEC. 2. Section 16305.8 of the Government Code is amended to read:16305.8. (a) Nothing in Sections 16305.3 to 16305.7, inclusive, shall apply to money drawn or collected by the Regents of the University of California.(b) Nothing in Sections 16520 to 16533, inclusive, and Sections 16610 to 16622, inclusive, shall apply to deposits held by the Trustees of the California State University in one or more depository institutions located outside of the United States if at least one of the following conditions is satisfied:(1) The amounts on deposit are insured under a foreign law.(2) The amounts on deposit that are not insured under a foreign law do not exceed one hundred thousand dollars ($100,000) per depository institution.SEC. 3. Section 16522 of the Government Code is amended to read:16522. The following securities may be received as security for demand and time deposits:(a) Bonds, notes, or other obligations of the United States, or those for which the faith and credit of the United States are pledged for the payment of principal and interest, including the guaranteed portions of small business administration loans, so long as those loans are obligations for which the faith and credit of the United States are pledged for the payment of principal and interest.(b) Notes or bonds or any obligations of a local public agency (as defined in the United States Housing Act of 1949) or any obligations of a public housing agency (as defined in the United States Housing Act of 1937) for which the faith and credit of the United States are pledged for the payment of principal and interest.(c) Bonds of this state or of any county, city, town, metropolitan water district, municipal utility district, municipal water district, bridge and highway district, flood control district, school district, water district, water conservation district or irrigation district within this state, and, in addition, revenue or tax anticipation notes, and revenue bonds payable solely out of the revenues from a revenue-producing property owned, controlled or operated by this state, or such local agency or district, or by a department, board, agency, or authority thereof.(d) Registered warrants of this state.(e) Bonds, consolidated bonds, collateral trust debentures, consolidated debentures, or other obligations issued by the United States Postal Service, federal land banks or federal intermediate credit banks established under the Federal Farm Loan Act, as amended, debentures and consolidated debentures issued by the Central Bank for Cooperatives and banks for cooperatives established under the Farm Credit Act of 1933, as amended, consolidated obligations of the Federal Home Loan Banks established under the Federal Home Loan Bank Act, bonds, debentures and other obligations of the Federal National Mortgage Association and of the Government National Mortgage Association established under the National Housing Act as amended, in the bonds of any federal home loan bank established under said act, bonds, debentures, and other obligations of the Federal Home Loan Mortgage Corporation established under the Emergency Home Finance Act of 1970, and in bonds, notes, and other obligations issued by the Tennessee Valley Authority under the Tennessee Valley Authority Act, as amended.(f) Bonds and notes of the California Housing Finance Agency issued pursuant to Chapter 7 (commencing with Section 41700) of Part 3 of Division 31 of the Health and Safety Code.(g) Promissory notes secured by first mortgages and first trust deeds upon residential real property located in California, provided that:(1) Notwithstanding Section 16521, the promissory notes shall at all times be in an amount in value at least 50 percent in excess of the amount deposited with the bank;(2) The Treasurer issues regulations, establishes procedures for determining the value of the promissory notes and develops standards necessary to protect the security of the deposits so collateralized;(3) The depository may exercise, enforce, or waive any right or power granted to it by promissory note, mortgage, or deed of trust; and(4) The following may not be used as security for deposits:(i) Any promissory note on which any payment is more than 90 days past due,(ii) Any promissory note secured by a mortgage or deed of trust as to which there is a lien prior to the mortgage or deed of trust, or(iii) Any promissory note secured by a mortgage or deed of trust as to which a notice of default has been recorded pursuant to Section 2924 of the Civil Code or an action has been commenced pursuant to Section 725a of the Code of Civil Procedure.(h) Bonds issued by the State of Israel.(i) Obligations issued, assumed, or guaranteed by the International Bank for Reconstruction and Development, the Inter-American Development Bank, the Asian Development Bank, the African Development Bank, the International Finance Corporation, or the Government Development Bank of Puerto Rico.(j) Any municipal securities, as defined by Section 3(a)(29) of the Securities Exchange Act of June 6, 1934, (15 U.S.C. 78, as amended), which are issued by this state or any local agency thereof.(k) Letters of credit issued by the Federal Home Loan Bank of San Francisco, which shall be in the form and shall contain provisions as the Treasurer may prescribe, and shall include the following terms:(1) The Treasurer shall be the beneficiary of the letter of credit.(2) The letter of credit shall be clean and irrevocable, and shall provide that the Treasurer may draw upon it up to the total amount in the event of the failure of the bank or if the bank refuses to permit the withdrawal of funds by the Treasurer or any other authorized state officer or employee.(3) Notwithstanding Section 16521, the letter of credit shall at all times be an amount in value of at least 100 percent of the amount deposited with the bank.(l) An eligible bank that has been selected by the Treasurer for the safekeeping of money belonging to, or in the custody of, the state, and that has its headquarters located outside of the state, may submit letters of credit that are drawn on its regional federal home loan bank as security, solely for deposits maintained in the Treasurers demand accounts, and subject to the terms set forth in paragraphs (1) and (2) to (3), inclusive, of subdivision (k).
The people of the State of California do enact as follows:
## The people of the State of California do enact as follows:
SECTION 1. Section 22050.5 of the Financial Code is amended to read:22050.5. (a) This division does not apply to any person who makes no more than one loan in a 12-month period if that loan is a commercial loan as defined in Section 22502.(b) This section shall remain in effect only until January 1, 2022, and as of that date is repealed.
SECTION 1. Section 22050.5 of the Financial Code is amended to read:
### SECTION 1.
22050.5. (a) This division does not apply to any person who makes no more than one loan in a 12-month period if that loan is a commercial loan as defined in Section 22502.(b) This section shall remain in effect only until January 1, 2022, and as of that date is repealed.
22050.5. (a) This division does not apply to any person who makes no more than one loan in a 12-month period if that loan is a commercial loan as defined in Section 22502.(b) This section shall remain in effect only until January 1, 2022, and as of that date is repealed.
22050.5. (a) This division does not apply to any person who makes no more than one loan in a 12-month period if that loan is a commercial loan as defined in Section 22502.(b) This section shall remain in effect only until January 1, 2022, and as of that date is repealed.
22050.5. (a) This division does not apply to any person who makes no more than one loan in a 12-month period if that loan is a commercial loan as defined in Section 22502.
(b) This section shall remain in effect only until January 1, 2022, and as of that date is repealed.
SEC. 2. Section 16305.8 of the Government Code is amended to read:16305.8. (a) Nothing in Sections 16305.3 to 16305.7, inclusive, shall apply to money drawn or collected by the Regents of the University of California.(b) Nothing in Sections 16520 to 16533, inclusive, and Sections 16610 to 16622, inclusive, shall apply to deposits held by the Trustees of the California State University in one or more depository institutions located outside of the United States if at least one of the following conditions is satisfied:(1) The amounts on deposit are insured under a foreign law.(2) The amounts on deposit that are not insured under a foreign law do not exceed one hundred thousand dollars ($100,000) per depository institution.
SEC. 2. Section 16305.8 of the Government Code is amended to read:
### SEC. 2.
16305.8. (a) Nothing in Sections 16305.3 to 16305.7, inclusive, shall apply to money drawn or collected by the Regents of the University of California.(b) Nothing in Sections 16520 to 16533, inclusive, and Sections 16610 to 16622, inclusive, shall apply to deposits held by the Trustees of the California State University in one or more depository institutions located outside of the United States if at least one of the following conditions is satisfied:(1) The amounts on deposit are insured under a foreign law.(2) The amounts on deposit that are not insured under a foreign law do not exceed one hundred thousand dollars ($100,000) per depository institution.
16305.8. (a) Nothing in Sections 16305.3 to 16305.7, inclusive, shall apply to money drawn or collected by the Regents of the University of California.(b) Nothing in Sections 16520 to 16533, inclusive, and Sections 16610 to 16622, inclusive, shall apply to deposits held by the Trustees of the California State University in one or more depository institutions located outside of the United States if at least one of the following conditions is satisfied:(1) The amounts on deposit are insured under a foreign law.(2) The amounts on deposit that are not insured under a foreign law do not exceed one hundred thousand dollars ($100,000) per depository institution.
16305.8. (a) Nothing in Sections 16305.3 to 16305.7, inclusive, shall apply to money drawn or collected by the Regents of the University of California.(b) Nothing in Sections 16520 to 16533, inclusive, and Sections 16610 to 16622, inclusive, shall apply to deposits held by the Trustees of the California State University in one or more depository institutions located outside of the United States if at least one of the following conditions is satisfied:(1) The amounts on deposit are insured under a foreign law.(2) The amounts on deposit that are not insured under a foreign law do not exceed one hundred thousand dollars ($100,000) per depository institution.
16305.8. (a) Nothing in Sections 16305.3 to 16305.7, inclusive, shall apply to money drawn or collected by the Regents of the University of California.
(b) Nothing in Sections 16520 to 16533, inclusive, and Sections 16610 to 16622, inclusive, shall apply to deposits held by the Trustees of the California State University in one or more depository institutions located outside of the United States if at least one of the following conditions is satisfied:
(1) The amounts on deposit are insured under a foreign law.
(2) The amounts on deposit that are not insured under a foreign law do not exceed one hundred thousand dollars ($100,000) per depository institution.
SEC. 3. Section 16522 of the Government Code is amended to read:16522. The following securities may be received as security for demand and time deposits:(a) Bonds, notes, or other obligations of the United States, or those for which the faith and credit of the United States are pledged for the payment of principal and interest, including the guaranteed portions of small business administration loans, so long as those loans are obligations for which the faith and credit of the United States are pledged for the payment of principal and interest.(b) Notes or bonds or any obligations of a local public agency (as defined in the United States Housing Act of 1949) or any obligations of a public housing agency (as defined in the United States Housing Act of 1937) for which the faith and credit of the United States are pledged for the payment of principal and interest.(c) Bonds of this state or of any county, city, town, metropolitan water district, municipal utility district, municipal water district, bridge and highway district, flood control district, school district, water district, water conservation district or irrigation district within this state, and, in addition, revenue or tax anticipation notes, and revenue bonds payable solely out of the revenues from a revenue-producing property owned, controlled or operated by this state, or such local agency or district, or by a department, board, agency, or authority thereof.(d) Registered warrants of this state.(e) Bonds, consolidated bonds, collateral trust debentures, consolidated debentures, or other obligations issued by the United States Postal Service, federal land banks or federal intermediate credit banks established under the Federal Farm Loan Act, as amended, debentures and consolidated debentures issued by the Central Bank for Cooperatives and banks for cooperatives established under the Farm Credit Act of 1933, as amended, consolidated obligations of the Federal Home Loan Banks established under the Federal Home Loan Bank Act, bonds, debentures and other obligations of the Federal National Mortgage Association and of the Government National Mortgage Association established under the National Housing Act as amended, in the bonds of any federal home loan bank established under said act, bonds, debentures, and other obligations of the Federal Home Loan Mortgage Corporation established under the Emergency Home Finance Act of 1970, and in bonds, notes, and other obligations issued by the Tennessee Valley Authority under the Tennessee Valley Authority Act, as amended.(f) Bonds and notes of the California Housing Finance Agency issued pursuant to Chapter 7 (commencing with Section 41700) of Part 3 of Division 31 of the Health and Safety Code.(g) Promissory notes secured by first mortgages and first trust deeds upon residential real property located in California, provided that:(1) Notwithstanding Section 16521, the promissory notes shall at all times be in an amount in value at least 50 percent in excess of the amount deposited with the bank;(2) The Treasurer issues regulations, establishes procedures for determining the value of the promissory notes and develops standards necessary to protect the security of the deposits so collateralized;(3) The depository may exercise, enforce, or waive any right or power granted to it by promissory note, mortgage, or deed of trust; and(4) The following may not be used as security for deposits:(i) Any promissory note on which any payment is more than 90 days past due,(ii) Any promissory note secured by a mortgage or deed of trust as to which there is a lien prior to the mortgage or deed of trust, or(iii) Any promissory note secured by a mortgage or deed of trust as to which a notice of default has been recorded pursuant to Section 2924 of the Civil Code or an action has been commenced pursuant to Section 725a of the Code of Civil Procedure.(h) Bonds issued by the State of Israel.(i) Obligations issued, assumed, or guaranteed by the International Bank for Reconstruction and Development, the Inter-American Development Bank, the Asian Development Bank, the African Development Bank, the International Finance Corporation, or the Government Development Bank of Puerto Rico.(j) Any municipal securities, as defined by Section 3(a)(29) of the Securities Exchange Act of June 6, 1934, (15 U.S.C. 78, as amended), which are issued by this state or any local agency thereof.(k) Letters of credit issued by the Federal Home Loan Bank of San Francisco, which shall be in the form and shall contain provisions as the Treasurer may prescribe, and shall include the following terms:(1) The Treasurer shall be the beneficiary of the letter of credit.(2) The letter of credit shall be clean and irrevocable, and shall provide that the Treasurer may draw upon it up to the total amount in the event of the failure of the bank or if the bank refuses to permit the withdrawal of funds by the Treasurer or any other authorized state officer or employee.(3) Notwithstanding Section 16521, the letter of credit shall at all times be an amount in value of at least 100 percent of the amount deposited with the bank.(l) An eligible bank that has been selected by the Treasurer for the safekeeping of money belonging to, or in the custody of, the state, and that has its headquarters located outside of the state, may submit letters of credit that are drawn on its regional federal home loan bank as security, solely for deposits maintained in the Treasurers demand accounts, and subject to the terms set forth in paragraphs (1) and (2) to (3), inclusive, of subdivision (k).
SEC. 3. Section 16522 of the Government Code is amended to read:
### SEC. 3.
16522. The following securities may be received as security for demand and time deposits:(a) Bonds, notes, or other obligations of the United States, or those for which the faith and credit of the United States are pledged for the payment of principal and interest, including the guaranteed portions of small business administration loans, so long as those loans are obligations for which the faith and credit of the United States are pledged for the payment of principal and interest.(b) Notes or bonds or any obligations of a local public agency (as defined in the United States Housing Act of 1949) or any obligations of a public housing agency (as defined in the United States Housing Act of 1937) for which the faith and credit of the United States are pledged for the payment of principal and interest.(c) Bonds of this state or of any county, city, town, metropolitan water district, municipal utility district, municipal water district, bridge and highway district, flood control district, school district, water district, water conservation district or irrigation district within this state, and, in addition, revenue or tax anticipation notes, and revenue bonds payable solely out of the revenues from a revenue-producing property owned, controlled or operated by this state, or such local agency or district, or by a department, board, agency, or authority thereof.(d) Registered warrants of this state.(e) Bonds, consolidated bonds, collateral trust debentures, consolidated debentures, or other obligations issued by the United States Postal Service, federal land banks or federal intermediate credit banks established under the Federal Farm Loan Act, as amended, debentures and consolidated debentures issued by the Central Bank for Cooperatives and banks for cooperatives established under the Farm Credit Act of 1933, as amended, consolidated obligations of the Federal Home Loan Banks established under the Federal Home Loan Bank Act, bonds, debentures and other obligations of the Federal National Mortgage Association and of the Government National Mortgage Association established under the National Housing Act as amended, in the bonds of any federal home loan bank established under said act, bonds, debentures, and other obligations of the Federal Home Loan Mortgage Corporation established under the Emergency Home Finance Act of 1970, and in bonds, notes, and other obligations issued by the Tennessee Valley Authority under the Tennessee Valley Authority Act, as amended.(f) Bonds and notes of the California Housing Finance Agency issued pursuant to Chapter 7 (commencing with Section 41700) of Part 3 of Division 31 of the Health and Safety Code.(g) Promissory notes secured by first mortgages and first trust deeds upon residential real property located in California, provided that:(1) Notwithstanding Section 16521, the promissory notes shall at all times be in an amount in value at least 50 percent in excess of the amount deposited with the bank;(2) The Treasurer issues regulations, establishes procedures for determining the value of the promissory notes and develops standards necessary to protect the security of the deposits so collateralized;(3) The depository may exercise, enforce, or waive any right or power granted to it by promissory note, mortgage, or deed of trust; and(4) The following may not be used as security for deposits:(i) Any promissory note on which any payment is more than 90 days past due,(ii) Any promissory note secured by a mortgage or deed of trust as to which there is a lien prior to the mortgage or deed of trust, or(iii) Any promissory note secured by a mortgage or deed of trust as to which a notice of default has been recorded pursuant to Section 2924 of the Civil Code or an action has been commenced pursuant to Section 725a of the Code of Civil Procedure.(h) Bonds issued by the State of Israel.(i) Obligations issued, assumed, or guaranteed by the International Bank for Reconstruction and Development, the Inter-American Development Bank, the Asian Development Bank, the African Development Bank, the International Finance Corporation, or the Government Development Bank of Puerto Rico.(j) Any municipal securities, as defined by Section 3(a)(29) of the Securities Exchange Act of June 6, 1934, (15 U.S.C. 78, as amended), which are issued by this state or any local agency thereof.(k) Letters of credit issued by the Federal Home Loan Bank of San Francisco, which shall be in the form and shall contain provisions as the Treasurer may prescribe, and shall include the following terms:(1) The Treasurer shall be the beneficiary of the letter of credit.(2) The letter of credit shall be clean and irrevocable, and shall provide that the Treasurer may draw upon it up to the total amount in the event of the failure of the bank or if the bank refuses to permit the withdrawal of funds by the Treasurer or any other authorized state officer or employee.(3) Notwithstanding Section 16521, the letter of credit shall at all times be an amount in value of at least 100 percent of the amount deposited with the bank.(l) An eligible bank that has been selected by the Treasurer for the safekeeping of money belonging to, or in the custody of, the state, and that has its headquarters located outside of the state, may submit letters of credit that are drawn on its regional federal home loan bank as security, solely for deposits maintained in the Treasurers demand accounts, and subject to the terms set forth in paragraphs (1) and (2) to (3), inclusive, of subdivision (k).
16522. The following securities may be received as security for demand and time deposits:(a) Bonds, notes, or other obligations of the United States, or those for which the faith and credit of the United States are pledged for the payment of principal and interest, including the guaranteed portions of small business administration loans, so long as those loans are obligations for which the faith and credit of the United States are pledged for the payment of principal and interest.(b) Notes or bonds or any obligations of a local public agency (as defined in the United States Housing Act of 1949) or any obligations of a public housing agency (as defined in the United States Housing Act of 1937) for which the faith and credit of the United States are pledged for the payment of principal and interest.(c) Bonds of this state or of any county, city, town, metropolitan water district, municipal utility district, municipal water district, bridge and highway district, flood control district, school district, water district, water conservation district or irrigation district within this state, and, in addition, revenue or tax anticipation notes, and revenue bonds payable solely out of the revenues from a revenue-producing property owned, controlled or operated by this state, or such local agency or district, or by a department, board, agency, or authority thereof.(d) Registered warrants of this state.(e) Bonds, consolidated bonds, collateral trust debentures, consolidated debentures, or other obligations issued by the United States Postal Service, federal land banks or federal intermediate credit banks established under the Federal Farm Loan Act, as amended, debentures and consolidated debentures issued by the Central Bank for Cooperatives and banks for cooperatives established under the Farm Credit Act of 1933, as amended, consolidated obligations of the Federal Home Loan Banks established under the Federal Home Loan Bank Act, bonds, debentures and other obligations of the Federal National Mortgage Association and of the Government National Mortgage Association established under the National Housing Act as amended, in the bonds of any federal home loan bank established under said act, bonds, debentures, and other obligations of the Federal Home Loan Mortgage Corporation established under the Emergency Home Finance Act of 1970, and in bonds, notes, and other obligations issued by the Tennessee Valley Authority under the Tennessee Valley Authority Act, as amended.(f) Bonds and notes of the California Housing Finance Agency issued pursuant to Chapter 7 (commencing with Section 41700) of Part 3 of Division 31 of the Health and Safety Code.(g) Promissory notes secured by first mortgages and first trust deeds upon residential real property located in California, provided that:(1) Notwithstanding Section 16521, the promissory notes shall at all times be in an amount in value at least 50 percent in excess of the amount deposited with the bank;(2) The Treasurer issues regulations, establishes procedures for determining the value of the promissory notes and develops standards necessary to protect the security of the deposits so collateralized;(3) The depository may exercise, enforce, or waive any right or power granted to it by promissory note, mortgage, or deed of trust; and(4) The following may not be used as security for deposits:(i) Any promissory note on which any payment is more than 90 days past due,(ii) Any promissory note secured by a mortgage or deed of trust as to which there is a lien prior to the mortgage or deed of trust, or(iii) Any promissory note secured by a mortgage or deed of trust as to which a notice of default has been recorded pursuant to Section 2924 of the Civil Code or an action has been commenced pursuant to Section 725a of the Code of Civil Procedure.(h) Bonds issued by the State of Israel.(i) Obligations issued, assumed, or guaranteed by the International Bank for Reconstruction and Development, the Inter-American Development Bank, the Asian Development Bank, the African Development Bank, the International Finance Corporation, or the Government Development Bank of Puerto Rico.(j) Any municipal securities, as defined by Section 3(a)(29) of the Securities Exchange Act of June 6, 1934, (15 U.S.C. 78, as amended), which are issued by this state or any local agency thereof.(k) Letters of credit issued by the Federal Home Loan Bank of San Francisco, which shall be in the form and shall contain provisions as the Treasurer may prescribe, and shall include the following terms:(1) The Treasurer shall be the beneficiary of the letter of credit.(2) The letter of credit shall be clean and irrevocable, and shall provide that the Treasurer may draw upon it up to the total amount in the event of the failure of the bank or if the bank refuses to permit the withdrawal of funds by the Treasurer or any other authorized state officer or employee.(3) Notwithstanding Section 16521, the letter of credit shall at all times be an amount in value of at least 100 percent of the amount deposited with the bank.(l) An eligible bank that has been selected by the Treasurer for the safekeeping of money belonging to, or in the custody of, the state, and that has its headquarters located outside of the state, may submit letters of credit that are drawn on its regional federal home loan bank as security, solely for deposits maintained in the Treasurers demand accounts, and subject to the terms set forth in paragraphs (1) and (2) to (3), inclusive, of subdivision (k).
16522. The following securities may be received as security for demand and time deposits:(a) Bonds, notes, or other obligations of the United States, or those for which the faith and credit of the United States are pledged for the payment of principal and interest, including the guaranteed portions of small business administration loans, so long as those loans are obligations for which the faith and credit of the United States are pledged for the payment of principal and interest.(b) Notes or bonds or any obligations of a local public agency (as defined in the United States Housing Act of 1949) or any obligations of a public housing agency (as defined in the United States Housing Act of 1937) for which the faith and credit of the United States are pledged for the payment of principal and interest.(c) Bonds of this state or of any county, city, town, metropolitan water district, municipal utility district, municipal water district, bridge and highway district, flood control district, school district, water district, water conservation district or irrigation district within this state, and, in addition, revenue or tax anticipation notes, and revenue bonds payable solely out of the revenues from a revenue-producing property owned, controlled or operated by this state, or such local agency or district, or by a department, board, agency, or authority thereof.(d) Registered warrants of this state.(e) Bonds, consolidated bonds, collateral trust debentures, consolidated debentures, or other obligations issued by the United States Postal Service, federal land banks or federal intermediate credit banks established under the Federal Farm Loan Act, as amended, debentures and consolidated debentures issued by the Central Bank for Cooperatives and banks for cooperatives established under the Farm Credit Act of 1933, as amended, consolidated obligations of the Federal Home Loan Banks established under the Federal Home Loan Bank Act, bonds, debentures and other obligations of the Federal National Mortgage Association and of the Government National Mortgage Association established under the National Housing Act as amended, in the bonds of any federal home loan bank established under said act, bonds, debentures, and other obligations of the Federal Home Loan Mortgage Corporation established under the Emergency Home Finance Act of 1970, and in bonds, notes, and other obligations issued by the Tennessee Valley Authority under the Tennessee Valley Authority Act, as amended.(f) Bonds and notes of the California Housing Finance Agency issued pursuant to Chapter 7 (commencing with Section 41700) of Part 3 of Division 31 of the Health and Safety Code.(g) Promissory notes secured by first mortgages and first trust deeds upon residential real property located in California, provided that:(1) Notwithstanding Section 16521, the promissory notes shall at all times be in an amount in value at least 50 percent in excess of the amount deposited with the bank;(2) The Treasurer issues regulations, establishes procedures for determining the value of the promissory notes and develops standards necessary to protect the security of the deposits so collateralized;(3) The depository may exercise, enforce, or waive any right or power granted to it by promissory note, mortgage, or deed of trust; and(4) The following may not be used as security for deposits:(i) Any promissory note on which any payment is more than 90 days past due,(ii) Any promissory note secured by a mortgage or deed of trust as to which there is a lien prior to the mortgage or deed of trust, or(iii) Any promissory note secured by a mortgage or deed of trust as to which a notice of default has been recorded pursuant to Section 2924 of the Civil Code or an action has been commenced pursuant to Section 725a of the Code of Civil Procedure.(h) Bonds issued by the State of Israel.(i) Obligations issued, assumed, or guaranteed by the International Bank for Reconstruction and Development, the Inter-American Development Bank, the Asian Development Bank, the African Development Bank, the International Finance Corporation, or the Government Development Bank of Puerto Rico.(j) Any municipal securities, as defined by Section 3(a)(29) of the Securities Exchange Act of June 6, 1934, (15 U.S.C. 78, as amended), which are issued by this state or any local agency thereof.(k) Letters of credit issued by the Federal Home Loan Bank of San Francisco, which shall be in the form and shall contain provisions as the Treasurer may prescribe, and shall include the following terms:(1) The Treasurer shall be the beneficiary of the letter of credit.(2) The letter of credit shall be clean and irrevocable, and shall provide that the Treasurer may draw upon it up to the total amount in the event of the failure of the bank or if the bank refuses to permit the withdrawal of funds by the Treasurer or any other authorized state officer or employee.(3) Notwithstanding Section 16521, the letter of credit shall at all times be an amount in value of at least 100 percent of the amount deposited with the bank.(l) An eligible bank that has been selected by the Treasurer for the safekeeping of money belonging to, or in the custody of, the state, and that has its headquarters located outside of the state, may submit letters of credit that are drawn on its regional federal home loan bank as security, solely for deposits maintained in the Treasurers demand accounts, and subject to the terms set forth in paragraphs (1) and (2) to (3), inclusive, of subdivision (k).
16522. The following securities may be received as security for demand and time deposits:
(a) Bonds, notes, or other obligations of the United States, or those for which the faith and credit of the United States are pledged for the payment of principal and interest, including the guaranteed portions of small business administration loans, so long as those loans are obligations for which the faith and credit of the United States are pledged for the payment of principal and interest.
(b) Notes or bonds or any obligations of a local public agency (as defined in the United States Housing Act of 1949) or any obligations of a public housing agency (as defined in the United States Housing Act of 1937) for which the faith and credit of the United States are pledged for the payment of principal and interest.
(c) Bonds of this state or of any county, city, town, metropolitan water district, municipal utility district, municipal water district, bridge and highway district, flood control district, school district, water district, water conservation district or irrigation district within this state, and, in addition, revenue or tax anticipation notes, and revenue bonds payable solely out of the revenues from a revenue-producing property owned, controlled or operated by this state, or such local agency or district, or by a department, board, agency, or authority thereof.
(d) Registered warrants of this state.
(e) Bonds, consolidated bonds, collateral trust debentures, consolidated debentures, or other obligations issued by the United States Postal Service, federal land banks or federal intermediate credit banks established under the Federal Farm Loan Act, as amended, debentures and consolidated debentures issued by the Central Bank for Cooperatives and banks for cooperatives established under the Farm Credit Act of 1933, as amended, consolidated obligations of the Federal Home Loan Banks established under the Federal Home Loan Bank Act, bonds, debentures and other obligations of the Federal National Mortgage Association and of the Government National Mortgage Association established under the National Housing Act as amended, in the bonds of any federal home loan bank established under said act, bonds, debentures, and other obligations of the Federal Home Loan Mortgage Corporation established under the Emergency Home Finance Act of 1970, and in bonds, notes, and other obligations issued by the Tennessee Valley Authority under the Tennessee Valley Authority Act, as amended.
(f) Bonds and notes of the California Housing Finance Agency issued pursuant to Chapter 7 (commencing with Section 41700) of Part 3 of Division 31 of the Health and Safety Code.
(g) Promissory notes secured by first mortgages and first trust deeds upon residential real property located in California, provided that:
(1) Notwithstanding Section 16521, the promissory notes shall at all times be in an amount in value at least 50 percent in excess of the amount deposited with the bank;
(2) The Treasurer issues regulations, establishes procedures for determining the value of the promissory notes and develops standards necessary to protect the security of the deposits so collateralized;
(3) The depository may exercise, enforce, or waive any right or power granted to it by promissory note, mortgage, or deed of trust; and
(4) The following may not be used as security for deposits:
(i) Any promissory note on which any payment is more than 90 days past due,
(ii) Any promissory note secured by a mortgage or deed of trust as to which there is a lien prior to the mortgage or deed of trust, or
(iii) Any promissory note secured by a mortgage or deed of trust as to which a notice of default has been recorded pursuant to Section 2924 of the Civil Code or an action has been commenced pursuant to Section 725a of the Code of Civil Procedure.
(h) Bonds issued by the State of Israel.
(i) Obligations issued, assumed, or guaranteed by the International Bank for Reconstruction and Development, the Inter-American Development Bank, the Asian Development Bank, the African Development Bank, the International Finance Corporation, or the Government Development Bank of Puerto Rico.
(j) Any municipal securities, as defined by Section 3(a)(29) of the Securities Exchange Act of June 6, 1934, (15 U.S.C. 78, as amended), which are issued by this state or any local agency thereof.
(k) Letters of credit issued by the Federal Home Loan Bank of San Francisco, which shall be in the form and shall contain provisions as the Treasurer may prescribe, and shall include the following terms:
(1) The Treasurer shall be the beneficiary of the letter of credit.
(2) The letter of credit shall be clean and irrevocable, and shall provide that the Treasurer may draw upon it up to the total amount in the event of the failure of the bank or if the bank refuses to permit the withdrawal of funds by the Treasurer or any other authorized state officer or employee.
(3) Notwithstanding Section 16521, the letter of credit shall at all times be an amount in value of at least 100 percent of the amount deposited with the bank.
(l) An eligible bank that has been selected by the Treasurer for the safekeeping of money belonging to, or in the custody of, the state, and that has its headquarters located outside of the state, may submit letters of credit that are drawn on its regional federal home loan bank as security, solely for deposits maintained in the Treasurers demand accounts, and subject to the terms set forth in paragraphs (1) and (2) to (3), inclusive, of subdivision (k).