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A F E. Security for Alabama Funds Enhancement Young Boozer, State Treasurer. History. That Fateful Call The Headlines We have a problem Get a solution. The Process. Pledging Statute Under Pledged Over Pledged Bank Group Organized Other States Best Result. The Solution. SAFE

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A f e

A F E

Security for Alabama Funds Enhancement

Young Boozer, State Treasurer


History

History

  • That Fateful Call

  • The Headlines

  • We have a problem

  • Get a solution


The process

The Process

  • Pledging Statute

    • Under Pledged

    • Over Pledged

  • Bank Group Organized

  • Other States

  • Best Result


The solution

The Solution

  • SAFE

  • Enacted 2001

  • Going Strong


Safe description

SAFE: Description

Statute: Title 41, Chapter 14A, Code of Alabama (effective January 1, 2001)

Participants

  • Board of Directors

  • SAFE Staff

  • Alabama Banks

  • Alabama Public Depositors

  • Custodian

    SAFE Program Rules

    Monthly Reporting by Banks


Safe board of directors

SAFE Board of Directors

State Treasurer Young Boozer, Chair

Lucinda Cockrell

CPA and Sumter County Administrator

Robert Davis

President and CEO, RBC Centura Bank

Ken Givens

Chief Financial Officer, Aliant Bank

John Harrison

Superintendent of the Alabama Department of Banking

Penny Smith

Deputy Finance Director and Treasurer for the city of Auburn

Alvis Storey

President, Merchants & Farmers Bank of Greene County

Kimberlea Wilson

Senior Vice President, Regions Financial Corporation


Safe program benefits

SAFE: Program Benefits

  • Cost/Time Savings

  • Increased Efficiency

  • Improved Liquidity

  • Improved Security

  • Triple “Insurance” Coverage


Safe key definitions

SAFE: Key Definitions

Covered Public Entities

Various governmental units of the state, counties, municipalities and other government entities or officials

Funds owned by a covered public entity are considered public funds.


Safe key definitions1

SAFE: Key Definitions

Public Deposits

Monies of any covered public entity or covered public official deposited in a bank, such as demand deposit accounts, savings accounts and certificates of deposit


Safe key definitions2

SAFE: Key Definitions

Qualified Public Depositoryor QPD

Any bank that has met all SAFE Program requirements has been designated by the Treasurer to receive and hold public deposits

By law, a bank must be a QPD to have public deposits.


What defines a qpd

What defines a QPD?

  • Is organized and exists in the U.S.

  • Is authorized to conduct the business of making loans and taking deposits in the State of Alabama

  • Has FDIC insurance

  • Executes necessary SAFE Program forms


What is a public entity

What is a Public Entity?

  • A state and its political subdivisions

  • Counties and their agencies

  • Municipalities and their agencies

  • Public corporations

  • Improvement authorities


Public depositor responsibilities safe rules 892 x 1 09

Public Depositor ResponsibilitiesSAFE Rules 892-X-1-.09

  • Deposit monies in QPD

    • Declare monies are public deposits

  • Verify annual account information received from bank as of September 30

    • Contact bank if no statement is received or information is incorrect

  • If bank defaults, submit claim form to SAFE


Public deposits not in safe

Public Deposits Not in SAFE

  • Act 2009-471 amended §41-14A-3 to allow public depositors to place funds in QPDs that are not covered by SAFE

  • Deposits are managed by an Alabama bank that distributes the deposits among several banks and each bank deposit is within FDIC limits


What happens when

What happens when… ?

A bank is SOLD

  • It re-opens on Monday under its new name.

  • There is no affect on public deposits.

  • It has 90 days to update SAFE documents.


What happens when1

What happens when… ?

A bank FAILS

  • FDIC manages bank affairs

  • Public depositor files a SAFE claim form within 120 days for deposits not covered under FDIC (§ 41-14A-9)


Safe stats

SAFE Stats

  • 164 participating Alabama banks

  • 4 non-participating banks:

    • Oakworth Capital (Birmingham)

    • Bank of Ozarks (Mobile)

    • Beal Bank (Irondale)

    • First Progressive Bank (Brewton)

  • Net Collateral Pool $7.9 Billion


Summary report as of 12 31 10

Summary Report (as of 12.31.10)


Questions www treasury alabama gov click safe

Questions?

www.treasury.alabama.gov

Click SAFE


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