LCO No. 4542 1 of 2
General Assembly Committee Bill No. 5849
January Session, 2025
LCO No. 4542
Referred to Committee on BANKING
Introduced by:
(BA)
AN ACT CONCERNING THE PRIORITY OF CLAIMS TO FINANCIAL
ASSETS OF SECURITIES INTERMEDIARIES.
Be it enacted by the Senate and House of Representatives in General
Assembly convened:
Section 1. Section 42a-8-511 of the general statutes is repealed and the 1
following is substituted in lieu thereof (Effective October 1, 2025): 2
(a) Except as otherwise provided in [subsections] subsection (b) [and 3
(c)] of this section, if a securities intermediary does not have sufficient 4
interests in a particular financial asset to satisfy both its obligations to 5
entitlement holders who have security entitlements to that financial 6
asset and its obligation to a creditor of the securities intermediary who 7
has a security interest in that financial asset, the claims of entitlement 8
holders, other than the creditor, have priority over the claim of the 9
creditor. 10
[(b) A claim of a creditor of a securities intermediary who has a 11
security interest in a financial asset held by a securities intermediary has 12
priority over claims of the securities intermediary's entitlement holders 13
who have security entitlements with respect to that financial asset if the 14
creditor has control over the financial asset.] 15
Committee Bill No. 5849
LCO No. 4542 2 of 2
[(c)] (b) If a clearing corporation does not have sufficient financial 16
assets to satisfy both its obligations to entitlement holders who have 17
security entitlements with respect to a financial asset and its obligation 18
to a creditor of the clearing corporation who has a security interest in 19
that financial asset, the claim of the creditor has priority over the claims 20
of entitlement holders. 21
This act shall take effect as follows and shall amend the following
sections:
Section 1 October 1, 2025 42a-8-511
Statement of Purpose:
To eliminate a statutory provision setting forth that a claim of a creditor
of a securities intermediary who has a security interest in a financial
asset held by a securities intermediary has priority over claims of the
securities intermediary's entitlement holders who have security
entitlements with respect to that financial asset if the creditor has control
over the financial asset.
[Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except
that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not
underlined.]
Co-Sponsors: REP. HOXHA, 78th Dist.
H.B. 5849