Regulatory Alerts1997-07-29
Added · Updated
State Banking Board Order Authorizing Pledging Assets to Secure Bank of North Dakota Letters of Credit
The North Dakota State Banking Board issued an order authorizing state-chartered banks to pledge assets to secure letters of credit issued by the Bank of North Dakota. This authorization allows banks to satisfy statutory requirements for securing public corporation deposits exceeding FDIC insurance limits by treating such pledges as incidental to banking. The order imposes conditions including potential FDIC approval, a maximum pledge value of 150 percent of the credit amount, and a restriction to letters of credit issued in favor of public corporations.
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