PURPOSE: This rule establishes the procedure to be used to set the interest rate on loan categories under the Linked Deposit Program and the maximum interest rate on loans in those categories.

1. (1) The treasurer’s office will survey financial institutions participating in the Linked Deposit Program to determine the present borrowing rate applicable to eligible borrowers in the following linked deposit loan categories: Agri-Business, Beginning Farmer (if loan is less than one hundred thousand dollars ($lOO,OOO)), Farming Operation, Livestock Operation, Marketing Operation, Small Business, Student Borrower, and Water Supply System. The survey will be conducted at least quarterly and each survey will include a minimum of ten percent (10%) of the financial institutions submitting loan applications in each respective category. The state treasurer will review the survey findings and will, after consulting with the Linked Deposit Review Committee, establish the interest rate for each respective linked deposit loan category listed above. The category rate established will apply until a new rate is set by the state treasurer.
2. (2) The treasurer’s office will advise financial institutions of the applicable category loan rate upon request and at the time a deposit offer is made under the program.
3. (3) The treasurer’s office will monitor interest rate markets and initiate surveys more frequently than quarterly when the treasurer judges that significant interest rate changes have occurred.

4. (4) The interest rate on the linked deposit loan made to a borrower in any of the categories listed in section (1) above, shall be no greater than seventy-five percent (75%) of the interest rate established by the treasurer for the particular category. Upon placement of a loan, the interest rate for the loan shall remain fixed for a period of one (1) year; except, if it so provides in the loan agreement, the lending financial institution may increase the interest rate on the loan, up to the category rate established by the treasurer, if the treasurer determines that the borrower has not complied / x with the law relating to the Linked Deposit Program and, as a result, the treasurer has received the full market interest rate on the deposit from the financial institution.

   Rebecca McDowell Cook

-.~--_ 15 CSR 50-2

*Original authority: 30.260 (19391, RSMo,

1. (5) In a linked deposit loan application made amended 1945,1957,1973,I983,I986,1988 and for a Job Enhancement Business and Begin- 30.760, RSMo (19861, amended 1987,1988,1989, ning Farmer (if loan is one hundred thousand 1991,1992,1993. dollars ($100,000) or more), the lending financial institution shall certify the present market borrowing rate applicable on a one (1) year fixed rate loan to the borrower. The lending financial institution shall also certify the interest rate on the loan to be made to the borrowing Job Enhancement Business under the Linked Deposit Program, but the interest rate on the loan shall be no greater than seventy percent (70%) of the certified market rate. The loan rate must be approved by the state treasurer and, upon placement of the linked deposit, the loan rate shall remain fixed for a period of one (1) year, subject to adjustment under the terms and conditions described in section (4), above.

2. (6) In a linked deposit loan application made for a residential property developer or a residential property owner, the lending financial institution shall certify the present market borrowing rate applicable on a three (3) year fixed rate loan to that borrower. The lending financial institution shall also certify the interest rate on the loan to be made to the residential property developer or residential property owner under the Linked Deposit Program, but the interest rate on the loan shall be no greater that seventy-five percent (75%) of the certified market rate for a loan up to one hundred thousand dollars ($lOO,OOO), nor greater than seventy percent (70%) of the certified market rate for a loan of one hundred thousand dollars ($100,000) or more. The loan rate must be approved by the state treasurer and, upon placement of the linked deposit, the loan rate shall remain fixed for a period of up to three (3) years, subject to adjustment under the terms and conditions described in section (4), above.

   Auth: sections 30.260 and 30.760, RSMo (1994).+ Emergency rule filed March 7, 1986, effective March 27, 1986, expired July 14,1986. Original rule filed June 26, 1986, effective Oct. 15,!986. Emergency amendment filed June 26,1986, effectiue July 6, 1986, expired Nou. 3, 1986. Emergency amendment filed Sept. 17, 1993, effective Sept. 27,1993, expired Jan. 25, 1994. Emergency amendment filed Jan. 19, 1994, effective Jan. 29, 1994, expired May28,1994. Emergency amendment filed Jan. 23,1995, effective Feb. 2, 1995, expired June 1, 1995. Amended: Filed Jan. 23, 1995, effective June 30, 1995.

   CODEOFSTATE REGULATIONS