PURPOSE: This rule lists those additional securities
that are acceptable investments for credit unions (see section
RSMo for statutory
following securities are approved for investment of Missouri credit unions:
bankers' acceptances and federal funds of insured domestic banks. No investment
in any such single institution or corporation shall exceed five percent (5%) of
the credit union's shares, surplus and reserve fund, nor shall the previously
mentioned investments exceed in the aggregate twenty-five percent (25%) of the
credit union's shares, surplus and reserve fund.
(2) Other securities, with the approval of
the director of the Division of Credit Unions, as may be permissible for
investment by federally chartered credit unions.
(3) Recognizing the increasing complexity and
importance of safe and sound investment decisions by credit unions, investment
policy is singled out for special attention. Each credit union will maintain
written investment policies. The investment policies will be as detailed as is
applicable to adequately address the degree of the individual credit union's
investment strategy and practice and to be in conformity with overall funds
credit unions may invest in Collateralized Mortgage Obligations (CMOs) rated at
least AA or better by a nationally recognized rating firm. Should the rating of
the instrument fall below the AA rating, the credit union will mark the
investment to market and should divest itself of the security as soon as
possible. The board of directors is responsible for determining the
permissibility of an investment which should be supported by legal opinion from
an independent source. In the aggregate, investments in CMOs shall not exceed
twice the amount of unimpaired equity of a credit union (regular reserves,
undivided earnings and unencumbered reserves). A credit union may request in
writing an exemption from the director for the aggregate limit.
(5) In addition, any state-chartered credit
union may invest in any instrument that is acceptable for a federal credit
union to invest in under federal rules and regulations.