§ 178-a. Custody and nominee registration of stock and securities. 1.\nNotwithstanding any other provision of law, including the provisions of\nthe administrative code of the city of New York and the education law,\nthe public officer or officers designated by law as the custodian of a\nfund are authorized, in accordance with the provisions of this section,\nto turn over the physical custody and safekeeping of any stock or other\nsecurities, in registered or bearer form, owned by such fund to (a) any\nstate bank or trust company located in this state, or (b) any national\nbank located in this state, or (c) any private banker duly authorized by\nthe superintendent of financial services of this state to engage in\nbusiness here. All such private bankers shall, as private bankers,\nmaintain a permanent capital of not less than one million dollars in\nthis state. Transfers of stocks or securities must receive the prior\nconsent of the trustees of such fund, under such terms and conditions as\nthey may specify. The custodian of such fund may direct such bank, trust\ncompany or private banker to register and hold any such stock or\nsecurities in its custody, in the name of its nominee. The custodian of\nsuch fund may also authorize such bank, trust company or private banker\nto deposit, or arrange for the deposit, of such stock or securities in a\nclearing corporation (as defined in article eight of the uniform\ncommercial code). In addition, the custodian of such fund may deposit,\nor authorize such bank, trust company or private banker, to deposit, or\narrange for the deposit of any of such securities the principal and\ninterest of which the United States, or any department, agency or\ninstrumentality thereof has agreed to pay, or has guaranteed payment,\nwith a federal reserve bank to be credited to an account as to which the\nownership of, and other interests in, such securities may be transferred\nby entries on the books of such federal reserve bank without physical\ndelivery of any securities. The records of such bank, trust company or\nprivate banker shall show, at all times, the ownership of such stock and\nsecurities, and they shall, when held in the possession of such bank,\ntrust company or private banker be, at all times, kept separate from the\nassets of such bank, trust company or private banker. When any such\nstock or securities are so registered in the name of a nominee, such\nbank, trust company or private banker shall be absolutely liable for any\nloss occasioned by the acts of such nominee with respect to such stock\nor securities.\n 2. (a) The custodian of such fund may also authorize such bank, trust\ncompany or private banker to appoint one or more foreign entities as its\nagent to hold and register foreign securities. Such foreign entity must\nbe either:\n (i) a banking institution or trust company holding securities itself\nor in a securities depository or clearing agency which acts as a\nsecurities depository; or\n (ii) a securities depository or clearing agency which acts as a\nsecurities depository.\n (b) For purposes of the appointment of a foreign entity as agent, the\nterm "banking institution or trust company" shall mean an entity which\nis:\n (i) regulated by the relevant regulatory authority in that\njurisdiction and has shareholders equity of not less than one hundred\nmillion dollars; or\n (ii) a branch of, or a majority-owned direct or indirect subsidiary\nof, a domestic bank, trust company or private banker eligible to be\nauthorized to have custody of securities under this section.\n (c) For purposes of the appointment of a foreign entity as agent, the\nterm "securities depository or clearing agency which acts as a\nsecurities depository" shall mean an entity which:\n (i) is regulated by the relevant national regulatory authority in that\njurisdiction;\n (ii) is operated pursuant to the charter and by-laws of any company or\nassociation organized as a securities depository or clearing
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