Bill Text: IA HF2231 | 2013-2014 | 85th General Assembly | Introduced
Bill Title: A bill for an act relating to federal home loan bank rights regarding collateral pledged by insurer-members. (Formerly HSB 568)
Spectrum: Committee Bill
Status: (Introduced - Dead) 2014-03-04 - Withdrawn. H.J. 395. [HF2231 Detail]
Download: Iowa-2013-HF2231-Introduced.html
House
File
2231
-
Introduced
HOUSE
FILE
2231
BY
COMMITTEE
ON
COMMERCE
(SUCCESSOR
TO
HSB
568)
A
BILL
FOR
An
Act
relating
to
federal
home
loan
bank
rights
regarding
1
collateral
pledged
by
insurer-members.
2
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
3
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5775HV
(2)
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rn/nh
H.F.
2231
Section
1.
Section
507C.2,
Code
2014,
is
amended
by
adding
1
the
following
new
subsections:
2
NEW
SUBSECTION
.
10A.
“Federal
home
loan
bank”
means
a
3
federal
home
loan
bank
established
under
the
federal
Home
Loan
4
Bank
Act,
12
U.S.C.
§1421
et
seq.
5
NEW
SUBSECTION
.
16A.
“Insurer-member”
means
an
insurer
who
6
is
a
member
of
a
federal
home
loan
bank.
7
Sec.
2.
Section
507C.5,
Code
2014,
is
amended
by
adding
the
8
following
new
subsection:
9
NEW
SUBSECTION
.
3.
a.
Notwithstanding
any
other
provision
10
to
the
contrary,
after
the
seventh
day
following
the
filing
of
11
a
delinquency
proceeding
a
federal
home
loan
bank
shall
not
12
be
stayed
or
prohibited
from
exercising
its
rights
regarding
13
collateral
pledged
by
an
insurer-member.
14
b.
If
a
federal
home
loan
bank
exercises
its
rights
15
regarding
collateral
pledged
by
an
insurer-member
who
is
16
subject
to
a
delinquency
proceeding,
the
federal
home
loan
17
bank
shall
repurchase
any
outstanding
capital
stock
that
is
in
18
excess
of
that
amount
of
federal
home
loan
bank
stock
that
the
19
insurer-member
is
required
to
hold
as
a
minimum
investment,
to
20
the
extent
the
federal
home
loan
bank
in
good
faith
determines
21
the
repurchase
to
be
permissible
under
applicable
laws,
22
regulations,
regulatory
obligations,
and
the
federal
home
loan
23
bank’s
capital
plan,
and
consistent
with
the
federal
home
loan
24
bank’s
current
capital
stock
practices
applicable
to
its
entire
25
membership.
26
c.
Following
the
appointment
of
a
receiver
for
an
27
insurer-member,
the
federal
home
loan
bank
shall,
within
ten
28
business
days
after
a
request
from
the
receiver,
provide
a
29
process
and
establish
a
timeline
for
all
of
the
following:
30
(1)
The
release
of
collateral
that
exceeds
the
amount
31
required
to
support
secured
obligations
remaining
after
32
any
repayment
of
loans
as
determined
in
accordance
with
the
33
applicable
agreements
between
the
federal
home
loan
bank
and
34
the
insurer-member.
35
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2231
(2)
The
release
of
any
of
the
insurer-member’s
collateral
1
remaining
in
the
federal
home
loan
bank’s
possession
following
2
repayment
of
all
outstanding
secured
obligations
of
the
3
insurer-member
in
full.
4
(3)
The
payment
of
fees
owed
by
the
insurer-member
and
the
5
operation
of
deposits
and
other
accounts
of
the
insurer-member
6
with
the
federal
home
loan
bank.
7
(4)
The
possible
redemption
or
repurchase
of
federal
8
home
loan
bank
stock
or
excess
stock
of
any
class
that
an
9
insurer-member
is
required
to
own.
10
d.
Upon
request
from
a
receiver,
the
federal
home
loan
11
bank
shall
provide
any
available
options
for
an
insurer-member
12
subject
to
a
delinquency
proceeding
to
renew
or
restructure
13
a
loan
to
defer
associated
prepayment
fees,
subject
to
14
market
conditions,
the
terms
of
any
loans
outstanding
to
the
15
insurer-member,
the
applicable
policies
of
the
federal
home
16
loan
bank,
and
the
federal
home
loan
bank’s
compliance
with
17
federal
laws
and
regulations.
18
Sec.
3.
Section
507C.28A,
Code
2014,
is
amended
by
adding
19
the
following
new
subsection:
20
NEW
SUBSECTION
.
10.
Notwithstanding
any
other
provision
21
of
this
chapter
to
the
contrary,
the
receiver
for
an
22
insurer-member
shall
not
void
any
transfer
of,
or
any
23
obligation
to
transfer,
money
or
any
other
property
arising
24
under
or
in
connection
with
any
federal
home
loan
bank
25
security
agreement,
or
any
pledge,
security,
collateral,
26
or
guarantee
agreement,
or
any
other
similar
arrangement
27
or
credit
enhancement
relating
to
a
federal
home
loan
bank
28
security
agreement
made
in
the
ordinary
course
of
business
29
and
in
compliance
with
the
applicable
federal
home
loan
bank
30
agreement.
However,
a
transfer
may
be
avoided
under
this
31
subsection
if
the
transfer
was
made
with
intent
to
hinder,
32
delay,
or
defraud
the
insurer-member,
the
receiver
for
33
the
insurer-member,
or
existing
or
future
creditors.
This
34
subsection
shall
not
affect
a
receiver’s
rights
regarding
35
-2-
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5775HV
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H.F.
2231
advances
to
an
insurer-member
in
delinquency
proceedings
1
pursuant
to
12
C.F.R.
§1266.4.
2
EXPLANATION
3
The
inclusion
of
this
explanation
does
not
constitute
agreement
with
4
the
explanation’s
substance
by
the
members
of
the
general
assembly.
5
This
bill
relates
to
federal
home
loan
bank
rights
regarding
6
collateral
pledged
by
insurer-members
in
delinquency
or
7
receivership
proceedings.
The
bill
defines
a
“federal
home
8
loan
bank”
to
mean
a
federal
home
loan
bank
established
under
9
the
federal
Home
Loan
Bank
Act,
and
an
“insurer-member”
to
mean
10
an
insurer
who
is
a
member
of
a
federal
home
loan
bank.
11
The
bill
provides
that,
after
the
seventh
day
following
the
12
filing
of
a
delinquency
proceeding,
a
federal
home
loan
bank
13
shall
not
be
stayed
or
prohibited
from
exercising
its
rights
14
regarding
collateral
pledged
by
an
insurer-member.
15
The
bill
provides
that
if
a
federal
home
loan
bank
exercises
16
its
rights
regarding
collateral
pledged
by
an
insurer-member
17
who
is
subject
to
a
delinquency
proceeding,
the
federal
home
18
loan
bank
shall
repurchase
any
outstanding
capital
stock
that
19
is
in
excess
of
that
amount
of
federal
home
loan
bank
stock
20
that
the
insurer-member
is
required
to
hold
as
a
minimum
21
investment,
to
the
extent
the
federal
home
loan
bank
in
22
good
faith
determines
the
repurchase
to
be
permissible
under
23
applicable
laws,
regulations,
regulatory
obligations,
and
the
24
federal
home
loan
bank’s
capital
plan,
and
consistent
with
25
the
federal
home
loan
bank’s
current
capital
stock
practices
26
applicable
to
its
entire
membership.
27
The
bill
provides
that
after
the
appointment
of
a
receiver
28
for
an
insurer-member,
the
federal
home
loan
bank
shall,
29
within
10
business
days
after
a
request
from
the
receiver,
30
provide
a
process
and
establish
a
timeline
for
the
release
of
31
collateral
that
exceeds
the
amount
required
to
support
secured
32
obligations
remaining
after
any
repayment
of
loans,
the
release
33
of
any
of
the
insurer-member’s
collateral
remaining
in
the
34
federal
home
loan
bank’s
possession
following
repayment
of
35
-3-
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5775HV
(2)
85
rn/nh
3/
4
H.F.
2231
all
outstanding
secured
obligations
of
the
insurer-member
in
1
full,
the
payment
of
fees
owed
by
the
insurer-member
and
the
2
operation
of
deposits
and
other
accounts
of
the
insurer-member
3
with
the
federal
home
loan
bank,
and
the
possible
redemption
or
4
repurchase
of
federal
home
loan
bank
stock
or
excess
stock
of
5
any
class
that
an
insurer-member
is
required
to
own.
6
The
bill
additionally
provides
that
upon
request
from
7
a
receiver,
the
federal
home
loan
bank
shall
provide
8
any
available
options
for
an
insurer-member
subject
to
a
9
delinquency
proceeding
to
renew
or
restructure
a
loan
to
defer
10
associated
prepayment
fees.
Such
a
renewal
or
restructuring
11
would
be
subject
to
market
conditions,
the
terms
of
any
loans
12
outstanding
to
the
insurer-member,
the
applicable
policies
of
13
the
federal
home
loan
bank,
and
the
federal
home
loan
bank’s
14
compliance
with
federal
laws
and
regulations.
15
The
bill
also
provides
that
a
receiver
for
an
insurer-member
16
shall
not
void
any
transfer
of,
or
any
obligation
to
transfer,
17
money
or
any
other
property
arising
under
or
in
connection
with
18
any
federal
home
loan
bank
security
agreement,
or
any
pledge,
19
security,
collateral,
or
guarantee
agreement,
or
any
other
20
similar
arrangement
or
credit
enhancement
relating
to
a
federal
21
home
loan
bank
security
agreement
made
in
the
ordinary
course
22
of
business
and
in
compliance
with
the
applicable
federal
home
23
loan
bank
agreement,
unless
the
transfer
was
made
with
intent
24
to
hinder,
delay,
or
defraud
the
insurer-member,
the
receiver
25
for
the
insurer-member,
or
existing
or
future
creditors.
The
26
bill
adds
that
this
provision
shall
not
affect
a
receiver’s
27
rights
regarding
advances
to
an
insurer-member
in
delinquency
28
proceedings
pursuant
to
federal
law.
29
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5775HV
(2)
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