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(D) a state or nationally chartered bank that is controlled by a bank holding company that
<br />controls a bank eligible to be a custodian under Section 2257.041.
<br />(7) "Public agency" means a state or a political or governmental entity, agency, instrumentality, or
<br />subdivision of a state, including a municipality, an institution of higher education, as defined by
<br />Section 61.003, Education Code, a junior college, a district created under Article XVI, Section 59, of
<br />the Texas Constitution, and a public hospital.
<br />(8) "Public entity" means a public agency in this state, but does not include an institution of higher
<br />education, as defined by Section 61.003, Education Code.
<br />(9) "State agency" means a public entity that:
<br />(A) has authority that is not limited to a geographic portion of the state; and
<br />(B) was created by the constitution or a statute.
<br />(10) "Trust receipt" means evidence of receipt, identification, and recording, including:
<br />(A) a physical controlled trust receipt; or
<br />(B) a written or electronically transmitted advice of transaction.
<br />Added by Acts 1993, 73rd Leg, ch. 268, § 1, eff. Sept. 1, 1993. Amended by Acts 1995, 74th Leg.,
<br />ch. 76, § 5.48(a), eff. Sept. 1,1995; Acts 1995, 74th Leg., ch. 914, § 5, eff. Sept. 1,1995; Acts 1997,
<br />75th Leg., ch. 254, § 1, eff. Sept. 1, 1997; Acts 1997, 75th Leg., ch. 891, § 3.22(4), eff. Sept. 1,
<br />1997; Acts 1997, 75th Leg., ch.1423, § 8.70, eff. Sept. 1,1997; Acts 1999, 76th Leg., ch. 62, § 7.63,
<br />eff. Sept. 1, 1999.
<br />§ 2257.0025. High-Risk Mortgage Security
<br />(a) For purposes of this chapter, a ffixed-rate collateralized mortgage obligation is a high-risk
<br />mortgage security if the security:
<br />(1) has an average life sensitivity with a weighted average life that:
<br />(A) extends by more than four years, assuming an immediate and sustained parallel
<br />shift in the yield curve of plus 300 basis points; or
<br />(B) shortens by more than six years, assuming an immediate and sustained parallel
<br />shift in the yield curve of minus 300 basis points; and
<br />(2) is price sensitive; that is, the estimated change in the price of the mortgage derivative
<br />product is more than 17 percent, because of an immediate and sustained parallel shift in the
<br />yield curve of plus or minus 300 basis points.
<br />(b) For purposes of this chapter, afloating-rate collateralized mortgage obligation is a high-risk
<br />mortgage security if the security:
<br />(1) bears an interest rate that is equal to the contractual cap on the instrument; or
<br />(2) is price sensitive; that is, the estimated change in the price of the mortgage derivative
<br />product is more than 17 percent, because of an immediate and sustained parallel shift in the
<br />yield curve of plus or minus 300 basis points.
<br />Added by Acts 1997, 75th Leg, ch. 254, § 2, eff. Sept. 1, 1997.
<br />§ 2257.003. Chapter Not Applicable to Deferred Compensation Plans This chapter does not apply to
<br />funds that a public entity maintains or administers under a deferred compensation plan, the federal
<br />income tax treatment of which is governed by Section 401(k) or 457 of the Internal Revenue Code of
<br />City of San Marcos Investment Policy Page 33
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