OAR 170-040-0080: Custodian Must Meet Statutory Requirements

(1) A depository may designate the Federal Home Loan Bank (“FHLB”) or any insured institution or trust company that has been approved by the State Treasurer and otherwise meets the criteria of ORS 295.001(6)(b) (an “approved institution”) only if, and so long as, the FHLB or approved institution demonstrates to the satisfaction of the State Treasurer that it complies with the duties of a custodian required under 295.001 to 295.108 (the “statutory requirements”). (2) If the State Treasurer determines that an approved institution has failed to comply with the statutory requirements, the State Treasurer shall revoke the prior approval granted under ORS 295.001(6)(b)(C) and remove the institution from the organizations that the State Treasurer has approved to serve as custodians. (3) If the State Treasurer determines that the FHLB or an approved institution has failed to comply with the statutory requirements, it will issue a notice to all depositories informing the depositories of the State Treasurer’s determination. After the State Treasurer has issued such notice, a depository may not use the FHLB or approved institution subject to the notice as its custodian and, as soon as practicable, shall enter into an agreement with a successor custodian and transfer all securities held by the FHLB or formerly approved institution to the successor custodian. (4) If the State Treasurer later determines that the FHLB or an insured institution or trust company is eligible to serve as a custodian because it has demonstrated to the satisfaction of the State Treasurer that it is capable of fulfilling the statutory requirements, the State Treasurer will issue a notice informing depositories of its determination and that the FHLB or insured institution or trust company subject to the notice is eligible to serve as a custodian, provided the insured institution or trust company has also been approved by the State Treasurer under ORS 295.001(6)(b)(C). (5) The State Treasurer will not designate an insured institution or trust company to serve as a custodian under ORS 295.001(6)(b)(C) unless it demonstrates to the satisfaction of the State Treasurer that it is capable of fulfilling the statutory requirements of a custodian.