A F E Security for Alabama Funds Enhancement Young Boozer, State Treasurer.
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Transcript of A F E Security for Alabama Funds Enhancement Young Boozer, State Treasurer.
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
•Enacted 2001
•Going Strong
SAFE: DescriptionStatute: 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 DirectorsState Treasurer Young Boozer, Chair
Lucinda CockrellCPA and Sumter County Administrator
Robert Davis President and CEO, RBC Centura Bank
Ken GivensChief Financial Officer, Aliant Bank
John HarrisonSuperintendent of the Alabama Department of Banking
Penny SmithDeputy Finance Director and Treasurer for the city of Auburn
Alvis StoreyPresident, Merchants & Farmers Bank of Greene County
Kimberlea WilsonSenior Vice President, Regions Financial Corporation
SAFE: Program Benefits
•Cost/Time Savings
•Increased Efficiency
•Improved Liquidity
•Improved Security
•Triple “Insurance” Coverage
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 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 Definitions
Qualified Public Depository or QPDAny 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?
•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?
• 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
• 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
• 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… ?
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 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
• 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)
Avg. Public Deposit Pool (in millions)
$10,291
Less FDIC $2,361Net Avg. Public Deposits (in millions)
$7,928
Total Public Entities 5,931Total # of QPDs 164Coverage Ratio - Net Avg. Deposits
115.88%Coverage Ratio - Total Actual Deposits
87.28%
Questions?www.treasury.alabama.gov
Click SAFE