State of Kansas
State Bank Commissioner
Special Order 1997-3
This order, is hereby issued this 4th day of November, 1997 by the Kansas State Bank Commissioner (Commissioner) pursuant to K.S.A. 9-1715, as amended.
Part I
For purposes of this order, the following definitions shall apply:
Governmental Unit means any state, or any county, municipality, or other political subdivision thereof.
Home State means:
(a) with respect to a national bank, the state in which the main office of the bank is located; and
(b) with respect to a state bank, the state by which the bank is chartered.
Host State means a state other than the home state of a bank in which the bank maintains a lawfully authorized branch.
Kansas National Bank means a federally chartered bank, the home state of which is Kansas.
Kansas State Bank means a state chartered bank, the home state of which is Kansas.
Public Money means all funds in the custody of any governmental unit pursuant to any provision of law authorizing such entity to collect, receive, or hold the same.
Part II
Whereas, pursuant to 12 U.S.C. § 90, a Kansas national bank is permitted to provide security for the safekeeping and prompt payment of the deposit of public money to the same extent and of the same kind as is authorized by the law of the state in which the national bank is located; and
Whereas, pursuant to 12 U.S.C. § 90, a Kansas national bank may pledge any of its assets as collateral or otherwise secure the deposits of public money for governmental units located in a host state of the bank, so long as such security is given in accordance with the laws of the host state; and,
Whereas, no Kansas law expressly allows a Kansas state bank to pledge its assets as collateral security for the deposits of governmental units in a host state; and
Whereas, K.S.A. 9-1715, as amended, grants to the commissioner "...the power to authorize any or all state banks to engage in any activity in which such banks could engage were they operating as national banks at the time such authority is granted..."; and
Whereas, the commissioner deems the issuance of this special order to be reasonably required to preserve the welfare of Kansas state banks and to promote competitive equality between Kansas state banks and Kansas national banks;
Part III
It is therefore ordered, that a Kansas state bank may pledge any of its assets as collateral or otherwise secure the deposits of public money for governmental units located in a host state of the bank, so long as such security is given in accordance with the laws of the host state.
It is further ordered, that pursuant to K.S.A. 9-1715(b), as amended, the terms of this special order shall become effective the 4th day of November, 1997 and shall remain in full force and effect until amended or revoked by the Commissioner.
It is so ordered.
State Bank Commissioner
W. Newton Male
