HF 1108

as introduced - 81st Legislature (1999 - 2000) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to financial institutions; providing lending 
  1.3             limits on loans secured by forward contracts for sale 
  1.4             of grain; amending Minnesota Statutes, section 48.24, 
  1.5             subdivisions 7, 8, and by adding a subdivision. 
  1.6   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.7      Section 1.  Minnesota Statutes 1998, section 48.24, 
  1.8   subdivision 7, is amended to read: 
  1.9      Subd. 7.  Obligations of any person, copartnership, limited 
  1.10  liability company, association, or corporation individual or 
  1.11  organization, however organized, in the form of notes or drafts 
  1.12  secured by shipping documents or instruments transferring or 
  1.13  securing title covering feeder livestock which is free from all 
  1.14  other encumbrances, when the market value of the livestock 
  1.15  securing the obligation at the time of the making of the loan is 
  1.16  not less than 115 percentum of the face amount of the notes 
  1.17  covered by such documents, shall be subject under this 
  1.18  subdivision to a limitation of 20 percent of capital and surplus 
  1.19  in addition to 20 percent of capital and surplus as included in 
  1.20  provisions of subdivision 1.  Feeder livestock loans as referred 
  1.21  to in this subdivision is defined to include only obligations 
  1.22  secured by liens or giving title to cattle, sheep, goats, hogs 
  1.23  or poultry being fattened for market, but excluding dairy 
  1.24  cattle, milk goats, poultry used for production of eggs, or 
  1.25  barnyard or work animals. 
  2.1      Sec. 2.  Minnesota Statutes 1998, section 48.24, 
  2.2   subdivision 8, is amended to read: 
  2.3      Subd. 8.  When a bank shall allow any individual, 
  2.4   partnership, limited liability company, unincorporated 
  2.5   association, or corporation organization, however organized, or 
  2.6   any officer or director of the bank, to become indebted to it, 
  2.7   directly or indirectly, in excess of the amount, exclusive of 
  2.8   interest permitted by the laws of this state, the officer or 
  2.9   employee of the bank willfully permitting or approving the loan 
  2.10  shall be guilty of a gross misdemeanor and, in addition thereto, 
  2.11  shall be personally liable to the bank for the amount of the 
  2.12  loan in excess of the statutory limit. 
  2.13     Sec. 3.  Minnesota Statutes 1998, section 48.24, is amended 
  2.14  by adding a subdivision to read: 
  2.15     Subd. 10.  [GRAIN FORWARD SALE CONTRACTS; LENDING 
  2.16  LIMITS.] Obligations of any individual or organization, however 
  2.17  organized, where the note is secured by a first lien on stored 
  2.18  grain and an assignment of the proceeds of a forward contract 
  2.19  for sale of the grain (1) with a nationally recognized commodity 
  2.20  buyer or broker, reasonably satisfactory to the bank, (2) where 
  2.21  the delivery of the grain under the contract will occur within 
  2.22  one year, and (3) where the value of the forward contract 
  2.23  exceeds 115 percent of the face amount of the secured note, is 
  2.24  subject under this subdivision to a limitation of 20 percent of 
  2.25  capital and surplus in addition to the 20 percent of capital and 
  2.26  surplus as included in provisions of subdivision 1.