(a) Every qualified public depository shall deposit with the state treasurer eligible collateral equal to or in excess of the required collateral of the depository. Each qualified public depository shall calculate monthly the amount of its required collateral based upon notice of its collateral-pledging level from the board.
Terms Used In Tennessee Code 9-4-504
Amendment: A proposal to alter the text of a pending bill or other measure by striking out some of it, by inserting new language, or both. Before an amendment becomes part of the measure, thelegislature must agree to it.
Average daily balance: means the sum of the average daily demand deposits, the average daily time deposits, and the average daily savings deposits of public depositors held during the calendar month immediately preceding the current month. See Tennessee Code 9-4-502
Collateral pool: means an arrangement whereby the repayment of public deposits deposited with any qualified public depository is secured through the sum total of eligible collateral pledged by all qualified public depositories, and contingent liability agreements as provided by the collateral pool board. See Tennessee Code 9-4-502
Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
Public deposit: means funds in which the entire beneficial interest is owned by a public depositor or funds held in the name of a public official of a public depositor charged with the duty to receive or administer funds and acting in such official's official capacity. See Tennessee Code 9-4-502
Public depositor: means the state of Tennessee, or any of its agencies, or any Tennessee county, Tennessee incorporated municipality and their political subdivisions, or any utility district organized under the laws of the state or any interstate compact to which the state is a party. See Tennessee Code 9-4-502
Public depository: means :(i) Any savings and loan association, or savings bank (collectively referred to as savings institutions), or any bank chartered by the state of Tennessee. See Tennessee Code 9-4-502
Qualified public depository: means any public depository that meets all of the requirements of this part and that has been authorized by the board to secure public deposits through the collateral pool. See Tennessee Code 9-4-502
State: when applied to the different parts of the United States, includes the District of Columbia and the several territories of the United States. See Tennessee Code 1-3-105
(b) A qualified public depository shall maintain required collateral to secure public deposits. A qualified public depository which accepts any public deposit that would increase its required collateral by twenty-five percent (25%) shall deposit additional eligible collateral to secure such increase within two (2) business days of the deposit.(c) Upon approval to participate in the collateral pool, a qualified public depository may secure public deposits through the collateral pool.(d) A qualified public depository shall notify its public depositors that all their public deposits are secured through the collateral pool as provided in this part. The notification shall be made at the time the public depository is admitted to the collateral pool or when an account is established by a public depositor with the qualified public depository. A qualified public depository must notify its public depositors of any change in the manner collateral is held. Notice to public depositors under this part shall constitute the mailing of the appropriate information to the individual indicated on the account authorization.(e) A qualified public depository shall carry in its accounting records a general ledger or other appropriate account of all public deposits to be secured through the collateral pool and the total value of eligible collateral pledged to secure such deposits.(f)(1) A qualified public depository may accept deposits, investments or deposits for placement as provided in § 9-1-118, and may act as custodian of other evidences of the deposits by the public entity.(2) Deposits placed in federally insured institutions, in amounts that are fully insured and that are not liabilities of the qualified public depository, are not included in the term average daily balance, as provided in § 9-4-502. However, any funds accepted for deposit or placement that are not placed in federally insured institutions shall be included in the term average daily balance and collateralized as provided in this section.(g) [Deleted by 2021 amendment.](h)[Repealed effective December 31, 2026.] Notwithstanding any law or rule to the contrary, a qualified public depository meeting the board-established criteria to pledge collateral equal to one hundred percent (100%) is authorized to pledge collateral equal to ninety percent (90%) of the public deposits held by the depository on or after November 12, 2021. This subsection (h) is repealed on December 31, 2026.
