2011 Kentucky Revised Statutes CHAPTER 41 DEPARTMENT OF THE TREASURY 41.610 Participation in program -- Investment agreements -- Required terms and conditions.
KY Rev Stat § 41.610 (1996 through Reg Sess) What's This?
41.610 Participation in program -- Investment agreements -- Required terms and
conditions.
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Qualified public depositories in Kentucky shall be eligible to participate in the
Linked Deposit Investment Program.
An eligible lending institution choosing to participate in the Linked Deposit
Investment Program shall enter into a linked deposit investment agreement with the
State Investment Commission which shall include requirements necessary to carry
out the purposes of the Linked Deposit Investment Program. A linked investment
shall bear a minimum rate of two percent (2%) and a maximum rate fixed by the
Wall Street Journal prime rate as published on the first business day of each month
less four percent (4%).
The eligible lending institution that desires to receive a linked deposit investment
shall agree to loan the funds to borrowers under the following terms:
(a) No loan shall exceed one hundred thousand dollars (0,000);
(b) Maturity dates of the loan shall be set as agreed to between the financial
institution and the borrower with a maximum maturity of seven (7) years; and
(c) The rate of interest for the term of the loan shall be fixed at the Wall Street
Journal prime rate as published on the first business day of each month, with a
minimum interest rate of five percent (5%).
An eligible lending institution that desires to receive a linked deposit shall accept
and review applications for loans from eligible small businesses and agribusinesses.
The lending institution shall assume all responsibility for credit underwriting and
shall apply all usual lending standards to determine the creditworthiness of each
applicant.
The eligible lending institution shall forward to the Kentucky Agricultural Finance
Corporation or the Cabinet for Economic Development, as appropriate, a completed
loan package for review to determine if the loan package is in accordance with the
administrative regulations promulgated pursuant to KRS 41.606(7). If the loan
package is found to be complete and in accordance with the administrative
regulations, it shall be forwarded to the State Investment Commission for funding.
The eligible lending institution shall charge no penalty for early payback of the
linked deposit loan. Principal repayments received by the lending institution shall
be returned to the State Investment Commission annually on the anniversary date of
the loan.
Applications for renewal of repurchase agreements shall be accompanied by a status
report on linked deposit loans.
The Commonwealth, the Kentucky Agricultural Finance Corporation, and the
Cabinet for Economic Development, their agents and employees, and the State
Investment Commission shall not be liable to any eligible lending institution in any
manner for payment of the principal or interest on the loan to an eligible small
business or to an eligible small agribusiness. Any delay in payments or default on
the part of a borrower shall not affect the deposit agreement between the eligible
lending institution and the State.
Effective: July 13, 2004
History: Amended 2004 Ky. Acts ch. 41, sec. 3, effective July 13, 2004. -- Amended
1998 Ky. Acts ch. 172, sec. 2, effective July 15, 1998. -- Amended 1996 Ky. Acts
ch. 208, sec. 6, effective July 15, 1996. -- Created 1994 Ky. Acts ch. 276, sec. 3,
effective July 15, 1994.
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