Section 892-X-1-.06 - Valuation Of Collateral (Alabama Administrative Code)

§ 892-X-1-.06. Valuation Of Collateral

(1) The QPD shall value its collateral, other than LOC and cash proceeds from any draw on a LOC, in the following manner:

(a) Use a nationally recognized source.

(b) Use market price, quality ratings, and pay-down factors on or after the 25th calendar day in the reported month and before the 1st calendar day of the following month.

(2) The Treasurer may elect to value pledged collateral, other than LOC, through a nationally recognized source as of the last business day of the month. The Treasurer shall recognize the lower of the two prices.

(3) LOC shall be treated as having a market value equal to their face amount for purposes of the SAFE Program. U.S. Dollar-denominated cash collateral representing proceeds from any draw on a LOC shall be valued at the face value thereof.

(4) Collateral unable to obtain a current market value by the pricing service utilized by SAFE is deemed ineligible collateral and must be substituted immediately.

(New Rule: Filed March 28, 2001; effective May 2, 2001. Amended (only rule number changed): Filed September 19, 2002; effective October 24, 2002. Amended: Filed December 20, 2004; effective January 24, 2005. Amended: Filed August 20, 2008; effective September 24, 2008.)

Rule 892-X-1-.07, was renumbered to Rule as per certification filed September 19, 2002; effective October 24, 2002.

Author: Daria S. Story, SAFE Division, Office of State Treasurer

Statutory Authority: Code of Ala. 1975, §§ 41-14A-5, 41-14A-6, as amended.

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