13-12-118. Surety bond; pledged investments; investment income; bond or pledge increases; hearings. (Note: this is effective as of 10/1/2019.)

(a) Except as otherwise provided by subsection (b) of this section, a special purpose depository institution shall, before transacting any business, pledge or furnish a surety bond to the commissioner to cover costs likely to be incurred by the commissioner in a liquidation or conservatorship of the special purpose depository institution. The amount of the surety bond or pledge of assets under subsection (b) of this section shall be determined by the commissioner in an amount sufficient to defray the costs of a liquidation or conservatorship.

(b) In lieu of a bond, a special purpose depository institution may irrevocably pledge specified capital equivalent to a bond under subsection (a) of this section. Any capital pledged to the commissioner under this subsection shall be held in a state or nationally chartered bank or savings and loan association having a principal or branch office in this state. All costs associated with pledging and holding such capital are the responsibility of the special purpose depository institution.

(c) Capital pledged to the commissioner shall be of the same nature and quality as those required for state financial institutions under W.S. 9-4-805.

(d) Surety bonds shall run to the state of Wyoming, and shall be approved under the terms and conditions required under W.S. 9-4-804(b) and (c).

(e) The commissioner may adopt rules to establish additional investment guidelines or investment options for purposes of the pledge or surety bond required by this section.

(f) In the event of a liquidation or conservatorship of a special purpose depository institution pursuant to W.S. 13-12-122, the commissioner may, without regard to priorities, preferences or adverse claims, reduce the surety bond or capital pledged under this section to cash as soon as practicable and utilize the cash to defray the costs associated with the liquidation or conservatorship.

(g) Income from capital pledged under subsection (b) of this section shall be paid to the special purpose depository institution, unless a liquidation or conservatorship takes place.

(h) Upon evidence that the current surety bond or pledged capital is insufficient, the commissioner may require a special purpose depository institution to increase its surety bond or pledged capital by providing not less than thirty (30) days written notice to the institution. The special purpose depository institution may request a hearing before the board not more than thirty (30) days after receiving written notice from the commissioner under this subsection. Any hearing before the board shall be held pursuant to the Wyoming Administrative Procedure Act.