(a) Whenever, pursuant to any statute of the state, any depository in the State of Arkansas must furnish security for the deposit of any public funds or whenever any security must be granted to any public official in connection with public funds the following shall be considered as eligible security for such purposes and subject to the depositor's discretion regarding the suitability of the collateral:
(1) The pledge or escrow of the assets of the bank consisting of any investment in which a state bank may invest pursuant to § 23-47-401;
(2) A surety bond issued by an insurance company licensed under the laws of the State of Arkansas and either:
(A) Rated “A” or better by any one (1) or more of the following rating agencies:
(i) A.M. Best Company, Inc.;
(ii) Standard & Poor's Insurance Rating Service;
(iii) Moody's Investors Service, Inc.; or
(iv) Duff & Phelps Credit Rating Co.; or
(B) Listed on the then-current United States Department of the Treasury Listing of Approved Sureties;
(3) Private deposit insurance issued by an insurance company licensed under the laws of the State of Arkansas and either:
(A) Rated “A” or better by any one (1) or more of the following rating agencies:
(i) A.M. Best Company, Inc.;
(ii) Standard & Poor's Insurance Rating Service;
(iii) Moody's Investors Service, Inc.; or
(iv) Duff & Phelps Credit Rating Co.; or
(B) Listed on the then-current United States Department of the Treasury Listing of Approved Sureties; or
(4) An irrevocable standby letter of credit issued by a Federal Home Loan Bank.
(b) The aggregate market value of assets pledged or escrowed or the face amount of the surety bond, private deposit insurance, or letter of credit securing the deposit of funds by any single depositor must be equal to or exceed the amount of the deposit to be secured.
(c) Notwithstanding subdivision (a)(1) of this section, if any political subdivision, school district, improvement district, or other issuer has defaulted on any bonds or other obligations within the preceding period of ten (10) years, bonds or other obligations of the defaulting political subdivision, school district, improvement district, or other issuer shall not be eligible as security for the deposit of public funds or as security required to be deposited in connection with public funds.