Minnesota Session Laws - 1991, Regular Session

  

                         Laws of Minnesota 1991 

                         CHAPTER 47-H.F.No. 614 
           An act relating to state finance; permitting 
          investments in all federally insured savings accounts; 
          amending Minnesota Statutes 1990, section 11A.24, 
          subdivision 4. 
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
    Section 1.  Minnesota Statutes 1990, section 11A.24, 
subdivision 4, is amended to read: 
    Subd. 4.  [OTHER OBLIGATIONS.] (a) The state board may 
invest funds in bankers acceptances, certificates of deposit, 
commercial paper, mortgage participation certificates and pools, 
repurchase agreements and reverse repurchase agreements, 
guaranteed investment contracts, savings accounts, and guaranty 
fund certificates, surplus notes, or debentures of domestic 
mutual insurance companies if they conform to the following 
provisions: 
     (1) bankers acceptances of United States banks are limited 
to those issued by banks rated in the highest four quality 
categories by a nationally recognized rating agency; 
     (2) certificates of deposit are limited to those issued by 
United States banks and savings institutions that are rated in 
the highest four quality categories by a nationally recognized 
rating agency or whose certificates of deposit are fully insured 
by the Federal Deposit Insurance Corporation or the Federal 
Savings and Loan Insurance Corporation federal agencies; 
     (3) commercial paper is limited to those issued by United 
States corporations or their Canadian subsidiaries and rated in 
the highest two quality categories by a nationally recognized 
rating agency; 
    (4) mortgage participation or pass through certificates 
evidencing interests in pools of first mortgages or trust deeds 
on improved real estate located in the United States where the 
loan to value ratio for each loan as calculated in accordance 
with section 61A.28, subdivision 3, does not exceed 80 percent 
for fully amortizable residential properties and in all other 
respects meets the requirements of section 61A.28, subdivision 
3; 
    (5) collateral for repurchase agreements and reverse 
repurchase agreements is limited to letters of credit and 
securities authorized in this section; 
    (6) guaranteed investment contracts are limited to those 
issued by insurance companies or banks rated in the top four 
quality categories by a nationally recognized rating agency; 
    (7) savings accounts are limited to those fully insured by 
the Federal Deposit Insurance Corporation or the Federal Savings 
and Loan Insurance Corporation federal agencies. 
    (b) Sections 16A.58 and 16B.06 do not apply to 
certifications of deposit and collateralization agreements 
executed by the state board under paragraph (a), clause (2). 
    (c) In addition to investments authorized by paragraph (a), 
clause (4), the state board may purchase from the Minnesota 
housing finance agency all or any part of a pool of residential 
mortgages, not in default, that has previously been financed by 
the issuance of bonds or notes of the agency.  The state board 
may also enter into a commitment with the agency, at the time of 
any issue of bonds or notes, to purchase at a specified future 
date, not exceeding 12 years from the date of the issue, the 
amount of mortgage loans then outstanding and not in default 
that have been made or purchased from the proceeds of the bonds 
or notes.  The state board may charge reasonable fees for any 
such commitment and may agree to purchase the mortgage loans at 
a price sufficient to produce a yield to the state board 
comparable, in its judgment, to the yield available on similar 
mortgage loans at the date of the bonds or notes.  The state 
board may also enter into agreements with the agency for the 
investment of any portion of the funds of the agency.  The 
agreement must cover the period of the investment, withdrawal 
privileges, and any guaranteed rate of return. 
    Presented to the governor May 2, 1991 
    Signed by the governor May 6, 1991, 11:08 a.m.