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In Response To:
Thread Starter: Richard Insley
Title: Re: Cash Collateral

When I was a bank examiner (long, long, long ago), we criticized a bank for maintaining a small balance loan or no-balance LOC secured by 40,000 silver dollars. There was zero risk of a loss on the loan, but the customer was obviously using this arrangement to avoid paying for safe deposit or safekeeping services. The loan yielded next to nothing, safe deposit/safekeeping income was lost, and there was a question about the bank's insurance coverage for all the bags of silver dollars.