An Act relating to insurance; concerning property and casualty insurance companies; clear- ing corporations; amending K.S.A. 40-2a20 and K.S.A. 1995 Supp. 84-8-108 and re- pealing the existing sections.
Be it enacted by the Legislature of the State of Kansas:
Section 1. K.S.A. 40-2a20 is hereby amended to read as follows:
40- 2a20. (a) Any insurance company other than life
heretofore or hereafter organized under any law of
this state, with the direction or approval of a majority of its
board of directors or authorized committee thereof, may: (a)(1) Adopt a nominee name unique to
such insurance company in which such insurance company's securities
may be registered; (b)(2) designate a state or national
bank having trust powers to obtain a nominee name for such
insurance company in which such insurance company's securities may
be registered; or (c)(3) designate a state or national
bank having trust powers as trustee to make any investment
authorized by this act in the name of such trustee or such
(b) Under the provisions of
subsections (b) and
(c) paragraphs (2) and (3) of subsection (a), the
designated state or national bank , in accor- dance with the
provisions of K.S.A. 84-8-108, and amendments thereto, may
arrange for such securities to be held in a clearing corporation.
Such arrangement must be in accordance with a written agreement,
approved by the commissioner of insurance, between the insurance
company and its designated bank and must impose the same degree of
responsibility on the bank as if such securities were held in
definitive form by such bank.
(c) As used in this section ``clearing corporation'' means: (1) A cor- poration defined in subsection (3) of K.S.A. 84-8-102, and amendments thereto;
(2) any organization or system for clearance and settlement of secu- rities transactions which is operated or owned by a bank, trust company or other entity that is subject to regulation by the United States federal reserve board or the United States comptroller of the currency; or
(3) any clearing agency registered with the securities and exchange commission pursuant to the securities exchange act of 1934, section 17A, and amendments thereto.
Sec. 2. K.S.A. 1995 Supp. 84-8-108 is hereby amended to read as follows: 84-8-108. (a) Notwithstanding any other provisions of law other than K.S.A. 40-2a20 and 40-2b20, and amendments thereto, any bank or trust company, when acting as fiduciary, and any bank or trust company, when holding securities as custodian for a fiduciary, is authorized to de- posit or arrange for the deposit of such securities in a clearing corporation, as defined in K.S.A. 84-8-102, and amendments thereto, which clearing corporation is either a member of a federal reserve bank or subject to supervision or regulation, pursuant to the provisions of the banking laws of the state of Kansas. When certificated securities are so deposited, cer- tificates representing securities of the same class of the same issuer may be merged and held in bulk in the name of the nominee of such clearing corporation with any other such securities deposited in such clearing cor- poration by any person regardless of the ownership of such securities, and certificates of small denomination may be merged into one or more certificates of larger denomination. The records of such fiduciary shall at all times show the name of the party for whose account the securities are so deposited. Ownership of, and other interests in, such securities may be transferred by bookkeeping entry on the books of such clearing cor- poration without physical delivery of certificates representing any such securities that are certificated.
(b) The term ``security'' whenever used in this act is defined in K.S.A. 84-8-102, and amendments thereto.
(c) This section shall apply to any bank or trust company when acting as fiduciary, and any bank or trust company, when holding securities as custodian for a fiduciary, acting on the effective date of this section or who thereafter may act regardless of the date of the agreement, instru- ment or court order by which it is appointed and regardless of whether or not such fiduciary or custodian owns capital stock of such clearing corporation.
Sec. 3. K.S.A. 40-2a20 and K.S.A. 1995 Supp. 84-8-108 are hereby repealed.
Sec. 4. This act shall take effect and be in force from and after its publication in the statute book.
Approved March 29, 1996.