1. The public funds of every county, township, city, town, village, school district of every character, road district, sewer district, fire protection district, water supply district, drainage or levee district, state hospital, state schools for the mentally deficient, Missouri School for the Deaf, Missouri School for the Blind, Missouri Training School for Boys, training school for girls, Missouri Veterans’ Home, Missouri State Chest Hospital, state university, Missouri state teachers’ colleges, Lincoln University, or any other political subdivision or agency of the state, that^* are deposited in any banking institution acting as a legal depositary of the funds under the statutes of Missouri requiring the letting and deposit of the same and the furnishing of security therefor shall be secured by the deposit of securities of the character prescribed by section 30.270 for the security of funds deposited by the state treasurer.

2. The securities shall, at the option of the depositary banking institution, be delivered either to the fiscal officer or the governing body of the municipal corporation or other depositor of the funds, or by depositing the securities with another banking institution or safe depositary as trustee satisfactory to both parties to the depositary agreement. The trustee may be a bank owned or controlled by the same bank holding company as the depositary banking institution.

3. The rights and duties of the several parties to the depositary contract shall be the same as those of the state and the depositary banking institution respectively under section 30.270. If a depositary banking institution deposits the bonds or securities with a trustee as above provided, and the municipal corporation or other depositor of funds gives notice in writing to the trustee that there has been a breach of the depositary contract and makes demand in writing on the trustee for the securities, or any part thereof, then the trustee shall forthwith surrender to the municipal corporation or other depositor of funds a sufficient amount of the securities to fully protect the depositor from loss and the trustee shall thereby be discharged of all further responsibility in respect to the securities so surrendered.

4. Pursuant to an agreement with the banking institution serving as a depositary for a public entity under this section, public funds held in the custody of the depositary may be invested in the obligations described in Article IV, Section 15 of the Missouri Constitution^** permitted for the state treasurer, including repurchase agreements, provided the investments are authorized in an investment policy adopted by the public entity, treasurer, or other finance officer authorized to act for the public entity.