Rule 80-7-1-.12. Highly Rated Foreign Banks

Rule 80-7-1-.12. Highly Rated Foreign Banks

1. (1) Highly rated foreign bank. For purposes of these Rules, a foreign bank is a highly rated foreign bank if each Georgia state branch and Georgia state agency, each federal branch and federal agency of the foreign bank, and each state branch and agency maintained by the foreign bank in a state other than Georgia:

   1. (a) As to Georgia state branches or Georgia state agencies, has a composite rating of 1 or 2 from the Department and the FRB under the interagency rating system for United States branches and agencies of foreign banks;
   2. (b) As to foreign bank federal branch or agency offices, or state branch or agency offices licensed by a state other than Georgia, has a composite rating of 1 or 2 from the FRB, the OCC or the relevant state bank supervisory authority, as applicable, under the interagency rating system for United States branches and agencies of foreign banks;
   3. (c) Is not subject to an administrative action, including, a cease and desist order, consent order, formal written agreement, or prompt corrective action directive; and

   4. (d) As to the foreign bank's capital, the foreign bank maintains capital on a consolidated basis that meets or exceeds the minimum capital standards under its home country law as of the most recent fiscal quarter and year end.

      Not less than annually, a highly rated foreign bank shall provide a certification to the Department confirming that it satisfies the provisions in this Rule to be considered a highly rated foreign bank, in accordance with such procedures as the Department shall establish. A highly rated foreign bank shall promptly inform the Department if it becomes aware of the existence of any fact that could cause its loss of status as "highly rated." The Department will also notify the foreign bank of its loss of status as a highly rated institution when such determination is made.

2. (2) Pledged Asset requirement for highly rated foreign banks. For a highly rated foreign bank, the maximum value of the required pledged assets shall be calculated according to the following schedule, as a percentage of average total liabilities for the previous month of such Georgia state branch or branches or Georgia state agency or agencies, including liabilities of an international banking facility maintained by such branch or branches or agency or agencies, but excluding amounts due and other liabilities to other offices, agencies, branches and affiliates not located in the state of Georgia and affiliates (as affiliates is defined in Code Section 7-1-1100), of such foreign bank:

   1. (a) one percent of the first $1 billion;
   2. (b) three quarters of one percent of the next $4 billion;
   3. (c) one half of one percent of the next $5 billion;
   4. (d) one quarter of one percent of any additional liabilities; and
   5. (e) provided, however, that in no event shall the maximum amount required to be pledged under this section exceed $100,000,000.
3. (3) Loss of highly rated status. Upon a foreign bank being informed by the Department that it is no longer deemed "highly rated" for purposes of this Rule, or, if sooner, the foreign bank otherwise becoming aware of the existence of any fact that could cause its loss of status as "highly rated," the foreign bank shall have 30 calendar days to comply with the Pledged Asset requirements applicable to those institutions not designated as "highly rated," unless otherwise directed by the Department.

Authority: O.C.G.A. §§ 7-1-61; 7-1-1109.

History. Original Rule entitled "Highly Rated Foreign Banks" adopted. F. Dec. 20, 2024; eff. Jan. 9, 2025.