New Jersey Administrative Code
Title 3 - BANKING
Chapter 6 - GENERAL PROVISIONS
Subchapter 16 - QUALIFIED BANK ACQUISITION OF UNDERWRITTEN SECURITIES
Section 3:6-16.2 - Conditions placed on a qualified bank acquiring certain underwritten securities
Universal Citation: NJ Admin Code 3:6-16.2
Current through Register Vol. 56, No. 18, September 16, 2024
(a) A qualified bank may acquire securities, for one or more of its trust accounts, from itself, another member of the underwriting syndicate of the security, or from an affiliate bank, when the qualified bank or affiliate holds the security or securities as a result of its being the underwriter or a member of the underwriting syndicate of the security, provided the following conditions are met with respect to each acquisition:
1. The
acquisition is a prudent and appropriate investment for each of the trust
accounts for which it is acquired;
2. The price paid is fair as established by
market quotation of the security or of securities of similar quality, yield and
maturity or as established by independent appraisal; and
3. A notification of such acquisition shall
be given by the qualified bank to the person or persons who receive the
periodic account statements issued by the qualified bank with respect to the
trust account for which the acquisition is made. The notification shall be in
writing and may be sent as an individual notice by regular mail or it may be
included as part of the next periodic statement. In the case of a common trust
fund, notification shall be disclosed in the annual financial report of such
fund.
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