Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Banking Regulation topic
No spam. Unsubscribe anytime.
Senate passes bill modernizing public‑fund depository rules and lifting 20% investment cap for Oregon banks
Summary
The Senate on May 7 passed House Bill 2971‑A to update definitions of bank net worth for public‑fund depositories and remove a 20% cap on certain out‑of‑state municipal investments, aiming to align state law with federal capital frameworks.
The Oregon State Senate on May 7 gave final passage to House Bill 2971‑A, a measure revising statutory definitions of depository net worth and removing an outdated 20% cap that limited state‑chartered banks’ investments in obligations of other U.S. states and local public bodies.
Sponsors told the chamber the change modernizes state law to align with federal regulatory capital frameworks and provide Oregon banks greater flexibility to diversify assets. "These changes will help strengthen Oregon's community banks," bill sponsor Senator Taylor said, noting the measure came unanimously from the Senate Labor and Business Committee and passed the House with strong support.
Under the amended ORS sections read into the record, the bill replaces older references to "stockholders' equity" with definitions tied to "tier 1 capital" and other capital measures appropriate to a bank’s regulatory framework, and it expands the list of permitted securities and collateral that may secure public funds. The read‑in language also clarifies definitions used in ORS chapters governing qualified depositories, treasurer reports and collateral requirements.
Senate debate was brief; there was no recorded amendment or extended floor controversy. The clerk called the roll following third reading, and the measure was declared passed after the requisite majority was recorded. The bill revises statutory text across multiple ORS sections governing eligible investments, report definitions and minimum collateral requirements for public funds.
Supporters characterized the package as a technical modernization to reduce barriers that previously constrained community banks’ ability to manage risk and compete. The statute changes include modified language for net worth, an expanded list of eligible securities, and a removal of the 20% cap on investments in obligations of other states or public bodies that meet certain rating requirements.
