Chapter DFI-SB 3

DFI-SB 3.07(4)(a) (a) The value of unlisted securities traded in the over-the-counter market is the average of the bid and asked price.

DFI-SB 3.07(4)(b) (b) The value of securities for which no market information is readily available is:

DFI-SB 3.07(4)(b)1. 1. For common stock or equivalent securities, net worth divided by the number of outstanding voting shares times the number of shares held.

DFI-SB 3.07(4)(b)2. 2. For preferred stock, redemption price, or par or stated value if not redeemable.

DFI-SB 3.07(4)(b)3. 3. For debt securities, the unpaid balance.

DFI-SB 3.07(4)(b)4. 4. For an interest in the capital of a partnership, the net worth of the partnership multiplied by the percentage of interest held.

DFI-SB 3.07(5) (5) Nature of disclosure. Statements required under sub. (2) shall disclose the existence of any reportable interest, but are not required to disclose its specific value.

DFI-SB 3.07 Note Note: This section interprets or implements s. 214.345 (2), Stats.

DFI-SB 3.07 Note Note: This rule is patterned after former s. S-L 9.04, effective from 1978 to 1989.

DFI-SB 3.07 History History: Cr. Register, February, 1994, No. 458, eff. 3-1-94.

subch. III of ch. DFI-SB 3 Subchapter III — Liquidity

DFI-SB 3.08 DFI-SB 3.08 Liquidity requirement.

DFI-SB 3.08(1) (1) The division shall establish, by periodic written notice to all savings banks, the minimum liquidity ratio that savings banks shall maintain. The ratio shall be between 4% and 15%. At least 50% of the minimum liquid assets shall consist of primary liquid assets. The division may require a savings bank to maintain a higher ratio if the division determines that the nature of the savings bank’s operations requires a higher liquidity ratio.

DFI-SB 3.08(2) (2) The liquidity ratio of a savings bank for a month shall be calculated as follows:

DFI-SB 3.08(2)(a) (a) Add the savings bank’s daily net withdrawable deposit accounts and its outstanding borrowings due in one year or less for the previous month.

DFI-SB 3.08(2)(b) (b) Divide the amount in par. (a) by the total number of days in the previous month.

DFI-SB 3.08(2)(c) (c) Divide the savings bank’s average daily total of liquid assets for the month for which the liquidity ratio is being calculated by the amount in par. (b).

DFI-SB 3.08(3) (3) A liquid asset shall be either cash or an obligation authorized for investment by a savings bank. Liquid assets do not include equity investments, loans except marketable corporate debt instruments which are rated in one of the 4 highest ratings by a nationally recognized rating service, and loan receivables.

DFI-SB 3.08(4) (4) In this section,”primary liquid assets” include the following unencumbered obligations:

DFI-SB 3.08(4)(a) (a) U.S. government and U.S. government agency obligations.

DFI-SB 3.08(4)(b) (b) Obligations issued by this state or a political subdivision, including a school district, in this state.

DFI-SB 3.08(4)(c) (c) Deposits in FDIC-insured financial institutions that equal or exceed the minimum capital requirements for savings banks.

DFI-SB 3.08(4)(d) (d) Cash, cash equivalent receivables, and settlements due from the U.S. or an agency of the U.S.

DFI-SB 3.08(4)(e) (e) Accrued interest receivable on any item in par. (a), (b), (c), (f), (g) or (h).

DFI-SB 3.08(4)(f) (f) Commercial paper of the 2 highest investment grades having a maturity of 270 days or less.

DFI-SB 3.08(4)(g) (g) Bankers acceptances having a maturity of 270 days or less of federally insured U.S. banks.

DFI-SB 3.08(4)(h) (h) Shares in open-end investment funds if at least 99% of the securities held by the fund would otherwise qualify as primary liquid assets under this section if held directly by the savings bank.

DFI-SB 3.08(4)(i) (i) Marketable corporate debt instruments which are rated in one of the 4 highest ratings by a nationally recognized rating service. In this par., marketable corporate debt instruments shall have a remaining maturity of no more than 36 months.

DFI-SB 3.08(5) (5) Other liquid assets which are not ”primary liquid assets” include the following unencumbered obligations:

DFI-SB 3.08(5)(a) (a) Mortgage backed securities which are readily salable in the securities market.

DFI-SB 3.08(5)(b) (b) Mortgage derivative securities with a projected maturity of less than 4 years which are readily salable in the securities market.

DFI-SB 3.08(5)(c) (c) Securities issued by other states and political subdivisions in other states.

DFI-SB 3.08(5)(d) (d) Other securities authorized by the division as investments and for which a secondary resale market exists, including authorized mutual fund investments.

DFI-SB 3.08(5)(e) (e) Accrued interest receivable on any item in pars. (a) to (d).

DFI-SB 3.08(6) (6) To qualify as a liquid asset, a security shall be current with respect to payment of scheduled principal or interest or both and shall be an authorized investment for a savings bank.

DFI-SB 3.08(7) (7) In this section:

DFI-SB 3.08(7)(a) (a) A savings bank’s designation of an investment under financial accounting standards board statement number 115 does not effect its liquid asset classification.

DFI-SB 3.08(7)(b) (b) The value of an investment included in liquid assets shall be accounted for under generally accepted accounting principles and financial accounting standards board statement number 115.

DFI-SB 3.08(7)(c) (c) Assets and liabilities of a wholly owned investment operating subsidiary shall be treated on a consolidated reporting basis with those of the parent savings bank.

DFI-SB 3.08 Note Note: A copy of the document captioned ”Accounting for Certain Investments in Debt and Equity Securities” (May 1993), known as ”Statement of Financial Accounting Standards No. 115” is available at the office of the division, the secretary of state and the legislative reference bureau. A copy may be obtained on request.

DFI-SB 3.08 History History: Cr. Register, February, 1994, No. 458, eff. 3-1-94; r. and recr., Register, March, 1996, No. 483, eff. 4-1-96; am. (4) (e), Register, October, 1996, No. 490, eff. 11-1-96; am. (3), cr., (4) (i), Register, November, 1997, No. 503, eff. 12-1-97.

subch. IV of ch. DFI-SB 3 Subchapter IV — Appraisal Policies and Practices

DFI-SB 3.09 DFI-SB 3.09 Duty of institution. Each savings bank shall establish appraisal policies and practices that set standards for appraisers and appraisals used by the savings bank. These standards must comply with the “Uniform Standards of Professional Appraisal Practice” or any other standards deemed appropriate by the division.

DFI-SB 3.09 Note Note: A copy of the document captioned “Uniform Standards of Professional Appraisal Practice” is available at the office of the division, the secretary of state and the legislative reference bureau. A copy may be obtained by writing The Appraisal Standards Board of the Appraisal Foundation, 1029 Vermont Ave., N.W., Suite 900, Washington, D.C. 20005. The document is also set out as Appendix I to ch. SPS 86, Wis. Adm. Code.

DFI-SB 3.09 History History: Cr. Register, February, 1994, No. 458, eff. 3-1-94.