In the event of loan default where privately held financial institution stock serves as collateral, is a Medallion Signature Guarantee required for the stock pledgor's signatures which happen to be corporate officers in this scenario? We aren't requiring, but was wondering if a lack of signature authentication of the corporate officers would create some hangup in liquidating the collateral. Anyone have experience with this?

You're lending money to another bank secured by the stock in the bank?

We are lending to a bank holding company which is pledging their interest in stock of the subsidary banks they own. Our collateral is stock certificates in small community banks which are not publicly traded. Medallion signature guarantees are usually required by transfer agents. Wasn't sure how the process worked in enforcing a security interest in this situation which involved a security interest in non-publicly traded stock. The stock powers on file have signatures of corporate officers, but no verification through a Medallion Signature Guarantee, so was wondering is this was a potential problem. Or perhaps no issue at all.

I take it you vetted these transactions through both of your regulators. Sounds like a highly unusual and risky transaction. I would have my attorney attached at my hip on a transaction like this.