Sec. 2256.0115.  AUTHORIZED INVESTMENTS:  SECURITIES LENDING PROGRAM.  (a)  A securities lending program is an authorized investment under this subchapter if it meets the conditions provided by this section.
(b)  To qualify as an authorized investment under this subchapter:
(1)  the value of securities loaned under the program must be not less than 100 percent collateralized, including accrued income;
(2)  a loan made under the program must allow for termination at any time;
(3)  a loan made under the program must be secured by:
(A)  pledged securities described by Section 2256.009;
(B)  pledged irrevocable letters of credit issued by a bank that is:
(i)  organized and existing under the laws of the United States or any other state;  and
(ii)  continuously rated by at least one nationally recognized investment rating firm at not less than A or its equivalent;  or
(C)  cash invested in accordance with Section:
(i)  2256.009;
(ii)  2256.013;
(iii)  2256.014;  or
(iv)  2256.016;
(4)  the terms of a loan made under the program must require that the securities being held as collateral be:
(A)  pledged to the investing entity;
(B)  held in the investing entity's name;  and
(C)  deposited at the time the investment is made with the entity or with a third party selected by or approved by the investing entity;
(5)  a loan made under the program must be placed through:
(A)  a primary government securities dealer, as defined by 5 C.F.R. Section 6801.102(f), as that regulation existed on September 1, 2003;  or
(B)  a financial institution doing business in this state;  and
(6)  an agreement to lend securities that is executed under this section must have a term of one year or less.
Added by Acts 2003, 78th Leg., ch. 1227, Sec. 1, eff. Sept. 1, 2003.