Bill Text: IA SF2133 | 2013-2014 | 85th General Assembly | Enrolled

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: A bill for an act relating to federal home loan bank rights regarding collateral pledged by insurer-members. (Formerly SSB 3120.) Effective 7-1-14.

Spectrum: Committee Bill

Status: (Passed) 2014-03-14 - Signed by Governor. S.J. 586. [SF2133 Detail]

Download: Iowa-2013-SF2133-Enrolled.html

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Senate File 2133
AN ACT
RELATING TO FEDERAL HOME LOAN BANK RIGHTS REGARDING COLLATERAL
PLEDGED BY INSURER-MEMBERS.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
Section 1. Section 507C.2, Code 2014, is amended by adding
the following new subsections:
NEW SUBSECTION . 10A. “Federal home loan bank” means a
federal home loan bank established under the federal Home Loan
Bank Act, 12 U.S.C. §1421 et seq.
NEW SUBSECTION . 16A. “Insurer-member” means an insurer who
is a member of a federal home loan bank.
Sec. 2. Section 507C.5, Code 2014, is amended by adding the
following new subsection:
NEW SUBSECTION . 3. a. Notwithstanding any other provision
to the contrary, after the seventh day following the filing of
a delinquency proceeding a federal home loan bank shall not
be stayed or prohibited from exercising its rights regarding
collateral pledged by an insurer-member.
b. If a federal home loan bank exercises its rights
regarding collateral pledged by an insurer-member who is
subject to a delinquency proceeding, the federal home loan
bank shall repurchase any outstanding capital stock that is in
excess of that amount of federal home loan bank stock that the
insurer-member is required to hold as a minimum investment, to
the extent the federal home loan bank in good faith determines
the repurchase to be permissible under applicable laws,
regulations, regulatory obligations, and the federal home loan
bank’s capital plan, and consistent with the federal home loan
bank’s current capital stock practices applicable to its entire
membership.

Senate File 2133, p. 2
c. Following the appointment of a receiver for an
insurer-member, the federal home loan bank shall, within ten
business days after a request from the receiver, provide a
process and establish a timeline for all of the following:
(1) The release of collateral that exceeds the amount
required to support secured obligations remaining after
any repayment of loans as determined in accordance with the
applicable agreements between the federal home loan bank and
the insurer-member.
(2) The release of any of the insurer-member’s collateral
remaining in the federal home loan bank’s possession following
repayment of all outstanding secured obligations of the
insurer-member in full.
(3) The payment of fees owed by the insurer-member and the
operation of deposits and other accounts of the insurer-member
with the federal home loan bank.
(4) The possible redemption or repurchase of federal
home loan bank stock or excess stock of any class that an
insurer-member is required to own.
d. Upon request from a receiver, the federal home loan
bank shall provide any available options for an insurer-member
subject to a delinquency proceeding to renew or restructure
a loan to defer associated prepayment fees, subject to
market conditions, the terms of any loans outstanding to the
insurer-member, the applicable policies of the federal home
loan bank, and the federal home loan bank’s compliance with
federal laws and regulations.
Sec. 3. Section 507C.28A, Code 2014, is amended by adding
the following new subsection:
NEW SUBSECTION . 10. Notwithstanding any other provision
of this chapter to the contrary, the receiver for an
insurer-member shall not void any transfer of, or any
obligation to transfer, money or any other property arising
under or in connection with any federal home loan bank
security agreement, or any pledge, security, collateral,
or guarantee agreement, or any other similar arrangement
or credit enhancement relating to a federal home loan bank
security agreement made in the ordinary course of business
and in compliance with the applicable federal home loan bank
agreement. However, a transfer may be avoided under this
subsection if the transfer was made with intent to hinder,
delay, or defraud the insurer-member, the receiver for
the insurer-member, or existing or future creditors. This

Senate File 2133, p. 3
subsection shall not affect a receiver’s rights regarding
advances to an insurer-member in delinquency proceedings
pursuant to 12 C.F.R. §1266.4.
______________________________
PAM JOCHUM
President of the Senate
______________________________
KRAIG PAULSEN
Speaker of the House
I hereby certify that this bill originated in the Senate and
is known as Senate File 2133, Eighty-fifth General Assembly.
______________________________
MICHAEL E. MARSHALL
Secretary of the Senate
Approved _______________, 2014
______________________________
TERRY E. BRANSTAD
Governor