§ 19-8-107 - Depository agreements. - Arkansas Statutes

19-8-107. Depository agreements.

(a) (1) After the receipt from the Bank Commissioner of the list of banks or banking institutions and recommended amounts of public funds each may accept, it shall then be the duty of the depository boards to designate the banks or banking institutions in which the funds shall be deposited and to enter into a depository agreement with each designated institution.

(2) The boards may at any time enter into depository agreements with any new bank chartered if the bank is certified by the commissioner, upon request therefor, as being eligible as a depository of public funds under the laws of this state. The certificate shall contain the recommended amount of public funds the bank may accept.

(3) (A) All county depository agreements shall be entered into using standardized forms provided by the State Board of Finance.

(B) The forms shall include language necessary to achieve a perfected security interest in all collateral for deposits.

(b) All depository agreements shall continue in full force and effect until the bank or banking institution receives written notice of revocation by the depository board or until there is a change of membership on the depository board.

(c) (1) The treasurers or other public officials or other persons having custody of these funds shall deposit them in such designated depositories.

(2) The depositing of these funds in the designated depositories shall relieve the public officer or other person and his or her sureties from any liability for the loss of the funds by reason of the default or insolvency of any depository.

(3) County officials are required to make timely investment of public funds in order to earn optimum interest consistent with the "prudent man" rule for investments as defined by Arkansas law.

(d) (1) County officials shall require security for the deposit or investment of public funds for amounts not fully insured directly by the United States.

(2) All security required under this subsection shall meet the requirements of an eligible security under 19-8-203 and 23-47-203(c).

(3) Public officials may require as a condition for placing deposits or keeping funds on deposit such financial data as they need so as to make an informed decision, including, but not limited to, quarterly financial statements, quarterly profit and loss statements, and tangible net worth or capital-to-assets ratios.