Raised Bill No. 323 proposes amendments to the Insurers Rehabilitation and Liquidation Act, specifically focusing on the treatment of Federal Home Loan Banks during an insurance company's rehabilitation or liquidation. The bill seeks to exempt Federal Home Loan Banks from the automatic stay provisions, allowing them to enforce their rights and causes of action within ten business days from the initiation of delinquency proceedings. It also protects Federal Home Loan Banks from having their transfers or obligations avoided by a receiver, except in cases of fraudulent transactions. The bill clarifies the conditions under which transfers made by an insurer may be considered fraudulent and subject to avoidance by the receiver.

Furthermore, the bill revises the definition of a preference and the conditions under which such a preference may be avoided by the liquidator, inserting language to exempt preferences involving a Federal Home Loan Bank from being voidable. It sets forth obligations for Federal Home Loan Banks in dealing with insurers under delinquency proceedings, including repurchasing excess capital stock and establishing processes for releasing collateral. The bill aims to protect the transactions between Federal Home Loan Banks and insurance companies under financial distress, and it includes deletions of general provisions regarding the avoidance of preferences, specifically carving out exemptions for Federal Home Loan Banks. These changes are set to become effective on October 1, 2024.

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