Ga. Comp. R. & Regs. R. 80-1-4-.03 - Accounting and Record Keeping for Investments

(1) Investment securities transactions shall be accounted for in accordance with generally accepted accounting principles.

(2) Banks shall maintain documentation sufficient to identify adequately the nature of all securities owned. For all securities other than direct investment in government bonds, notes, or debentures, documentation may include annual reports, offering circulars, credit analyses published by nationally recognized rating firms, or inhouse analyses, reflecting an evaluation of the degree of risk in regard to liquidity, marketability, price volatility, and eligibility for pledging.

(3) Investments in the form of "Zero Coupon" obligations shall be recorded at cost plus accretion to maturity over the life of the obligations. Legal limitations applicable to such securities shall be measured against the actual cost of the security. Provided, however, except in the case of U.S. Government issues, to the extent that the cash investment plus accretions of income earned, but not collected, exceed the legal limitation on any zero coupon security, such amount shall be set aside into a capital reserve and excluded in considering capital adequacy.

Notes

Ga. Comp. R. & Regs. R. 80-1-4-.03

O.C.G.A. Sec. 7-1-61.

Original Rule entitled "Basis for Determining Legal Limits of Any One Obligor Under the Provisions of Section 23 (13-2023) Article 19 of the Banking Law" adopted. F. and eff. June 30, 1965. Repealed: New Rule entitled "Legal Investment Securities for State Banks" adopted. F. June 9, 1972; eff. June 29, 1972. Repealed: F. Aug. 28, 1975; eff. Sept. 17, 1975. Amended: New Rule entitled "Custody and Safekeeping" adopted. F. Oct. 12, 1989; eff. Nov. 1, 1989. Amended: F. July 11, 1994; eff. July 31, 1994. Repealed: New Rule entitled "Accounting and Record Keeping for Investments" adopted. F. Oct. 22, 2001; eff. Nov. 11, 2001.