Bill > S05347

This bill amends the New York State insurance law to provide special protections and procedures for Federal Home Loan Banks (FHLBs) in cases of insurance company insolvency or delinquency proceedings. Specifically, the bill prevents a receiver from voiding transfers of money or property under an FHLB security agreement unless there is actual intent to defraud, and prohibits voiding stock redemptions within four months of proceedings. The bill requires FHLBs to cooperate with receivers by providing a process for releasing collateral, managing accounts, and addressing stock redemptions within five days of request. It also mandates that FHLBs assist the insurance department by potentially offering options to restructure advances, facilitate collateral substitutions, and support orderly proceedings. Furthermore, the bill prevents courts from staying or enjoining an FHLB from exercising its rights under a security agreement and prohibits receivers from disavowing or rejecting FHLB security agreements. These provisions aim to provide more clarity and protection for Federal Home Loan Banks during insurance company insolvency proceedings, ensuring their ability to manage their financial interests while supporting regulatory oversight.

Business and Industry

https://www.nysenate.gov/legislation/bills/2025/S5347