Audit, Dept. of

Banking Division

Chapter 16: Certain Obligations Exempt from Bank Debt Limitations

Effective Date: 04/18/2014 to Current

Rule Type: Current Rules & Regulations

Reference Number: 021.0002.16.04182014

CHAPTER 16 – CERTAIN OBLIGATIONS EXEMPT FROM BANK DEBT LIMITATIONS

Section 1. Authority.

This Chapter is promulgated in part pursuant to W.S. 13-2-101(a)(xiii) (authorized bank activities) and W.S. 13-3-404(a)(ii)(indebtedness limitations).

Section 2. Certain obligations exempt from debt limitations.

Notwithstanding the provisions of W.S. 13-3-402, a person is permitted to become indebted to a bank if, but only to the extent that, the repayment of the principal indebtedness and the interest accrued thereon is:

1. (a) A general obligation of a state or a political subdivision of a state; or
2. (b) An obligation issued by any of the following:
3. (i) the Federal National Mortgage Association;
4. (ii) the Federal Home Loan Mortgage Corporation;
5. (iii) the Federal Farm Credit Bank;
6. (iv) the Student Loan Marketing Association;
7. (v) the Federal Home Loan Bank;
8. (vi) the Financing Corporation, which is also known as FICO;
9. (vii) the Resolution Funding Corporation; or
10. (viii) the Tennessee Valley Authority.

(c) A limited obligation bond, revenue bond, and obligations that satisfy the requirements of 26 USC 142(b)(1) issued by or on behalf of any State or political subdivision of a State, including any municipal corporate instrumentality of 1 or more States, or any public agency or authority of any State or political subdivision of a State.

Section 3. Safe and Sound Banking Practices.

A bank shall adhere to safe and sound banking practices in conducting any activity described in this Chapter. The bank shall consider, as appropriate, the market, credit, liquidity and operational risks presented by a proposed activity. Each bank shall maintain records available for examination purposes adequate to demonstrate that it complies with this Chapter.