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(3) collateralized mortgage obligations that have a stated final maturity date of greater than 10 years;
<br />and
<br />(4) collateralized mortgage obligations the interest rate of which is determined by an index that adjusts
<br />opposite to the changes in a market index.
<br />Amended by Acts 1995, 74th Leg., ch. 402, Sec. 1, eff. Sept. 1, 1995; Acts 1999, 76th Leg., ch.1454, Sec. 7, eff. Sept.
<br />1,1999; Acts 2001, 77th Leg., ch. 558, Sec. 1, eff. Sept. 1, 2001.
<br />Sec. 2256.010. AUTHORIZED INVESTMENTS: CERTIFICATES OF DEPOSIT AND SHARE
<br />CERTIFICATES. (a) A certificate of deposit or share certificate is an authorized investment under this subchapter if the
<br />certificate is issued by a depository institution that has its main office or a branch office in this state and is:
<br />(1) guaranteed or insured by the Federal Deposit Insurance Corporation or its successor or the National
<br />Credit Union Share Insurance Fund or its successor;
<br />(2) secured by obligations that are described by Section 2256.009(a), including mortgage backed
<br />securities directly issued by a federal agency or instrumentality that have a market value of not less than the principal
<br />amount of the certificates, but excluding those mortgage backed securities of the nature described by Section
<br />2256.009(b); or
<br />(3) secured in any other manner and amount provided by law for deposits of the investing entity.
<br />(b) In addition to the authority to invest funds in certificates of deposit under Subsection (a), an investment in
<br />certificates of deposit made in accordance with the following conditions is an authorized investment under this
<br />subchapter:
<br />(1) the funds are invested by an investing entity through a depository institution that has its main office
<br />or a branch office in this state and that is selected by the investing entity;
<br />(2) the depository institution selected by the investing entity under Subdivision (1) arranges for the
<br />deposit of the funds in certificates of deposit in one or more federally insured depository institutions, wherever located,
<br />for the account of the investing entity;
<br />(3) the full amount of the principal and accrued interest of each of the certificates of deposit is insured
<br />by the United States or an instrumentality ofthe United States;
<br />(4) the depository institution selected by the investing entity under Subdivision (1) acts as custodian
<br />for the investing entity with respect to the certificates of deposit issued for the account of the investing entity; and
<br />(5) at the same time that the funds are deposited and the certificates of deposit are issued for the
<br />account of the investing entity, the depository institution selected by the investing entity under Subdivision (1) receives
<br />an amount of deposits from customers of other federally insured depository institutions, wherever located, that is equal to
<br />or greater than the amount of the funds invested by the investing entity through the depository institution selected under
<br />Subdivision (1).
<br />Amended by Acts 1995, 74th Leg., ch. 32, Sec. 1, eff. April 28,1995; Acts 1995, 74th Leg., ch. 402, Sec. 1, eff. Sept. 1,
<br />1995; Acts 1997, 75th Leg., ch. 1421, Sec. 6, eff. Sept. 1, 1997; Acts 2005, 79th Leg., ch. 128, Sec. 1, eff. Sept. 1,
<br />2005.
<br />Sec. 2256.011. AUTHORIZED INVESTMENTS: REPURCHASE AGREEMENTS. (a) A fully collateralized
<br />repurchase agreement is an authorized investment under this subchapter if the repurchase agreement:
<br />(1) has a defined termination date;
<br />(2) is secured by obligations described by Section 2256.009(a)(1); and
<br />(3) requires the securities being purchased by the entity to be pledged to the entity, held in the entity's
<br />name, and deposited at the time the investment is made with the entity or with a third party selected and approved by the
<br />entity; and
<br />(4) is placed through a primary government securities dealer, as defined by the Federal Reserve, or a
<br />fmancial institution doing business in this state.
<br />City of San Marcos Investment Policy Page 24
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