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Page 19 of 37 <br />(1) the value of securities loaned under the program must <br />be not less than 100 percent collateralized, including accrued <br />income; <br />(2) a loan made under the program must allow for <br />termination at any time; <br />(3) a loan made under the program must be secured by: <br />(A) pledged securities described by Section 2256.009; <br />(B) pledged irrevocable letters of credit issued by a <br />bank that is: <br />(i) organized and existing under the laws of the <br />United States or any other state; and <br />(ii) continuously rated by at least one nationally <br />recognized investment rating firm at not less than A or its <br />equivalent; or <br />(C) cash invested in accordance with Section: <br />(i) 2256.009; <br />(ii) 2256.013; <br />(iii) 2256.014; or <br />(iv) 2256.016; <br />(4) the terms of a loan made under the program must <br />require that the securities being held as collateral be: <br />(A) pledged to the investing entity; <br />(B) held in the investing entity's name; and <br />(C) deposited at the time the investment is made with <br />the entity or with a third party selected by or approved by the <br />investing entity; <br />(5) a loan made under the program must be placed through: <br />(A) a primary government securities dealer, as defined <br />by 5 C.F.R. Section 6801.102(f), as that regulation existed on <br />September 1, 2003; or <br />(B) a financial institution doing business in this <br />state; and <br />(6) an agreement to lend securities that is executed under <br />this section must have a term of one year or less. <br />Added by Acts 2003, 78th Leg., ch. 1227, Sec. 1, eff. Sept. 1, 2003. <br />4/18/2018 <br />