92 Federal Register / Vol. 62, No. 58 / Wednesday, March 26, 1997 / Notices

1Citibank (Channel Islands) Limited; Citibank,

S.A. in France; Citicorp Investment Bank (The

Netherlands) N.V.; Citibank (Zaire) S.A.R.L.;

Citibank Zambia Limited; Citicorp Nominees Pty.

Limited in Australia; Citibank Nominees (New

Zealand) Limited; Citibank Portugal, S.A.; Banco de

Honduras S.A.; Citibank Budapest Rt.; CitibankMaghreb in Morocco; Citibank (Trinidad & Tobago)

Limited; Cititrust Columbia S.A. Sociedad

Fiduciaria; Citibank (Poland) S.A.; and Citibank a.s.

in the Czech Republic (collectively, the ‘‘Citibank

Subsidiaries’’).

2 Investment Company Act Release Nos. 21087

(May 22, 1995) (notice)and 21145 (June 19, 1995)

(order).

5. Tentative Agenda for the May 5–6,

1997, meeting in Washington, DC.

CONTACT PERSON FOR MORE INFORMATION:

Thomas J. Koerber, Secretary of the

Board, U.S. Postal Service, 475 L’Enfant

Plaza, SW., Washington, DC 20260–

1000. Telephone (202) 268–4800.

Thomas J. Koerber,

Secretary.

[FR Doc. 97–7756 Filed 3–21–97; 4:33 pm]

BILLING CODE 7710–12–M

SECURITIES AND EXCHANGE

COMMISSION

Submission for OMB Review;

Comment Request

Upon Written Request, Copies Available

From: Securities and Exchange

Commission, Office of Filings and

Information Services, Washington, DC

20549

Extension:

Form 11–K, SEC File No. 270–101,

OMB Control No. 3235–0082

Form T–6, SEC File No. 270–344,

OMB Control No. 3235–0391

Notice is hereby given that, pursuant

to the Paperwork Reduction Act of 1995

(44 U.S.C. 3501 et seq.), the Securities

and Exchange Commission

(‘‘Commission’’) has submitted to the

Office of Management and Budget

requests for reinstatement of the

previously approved collections of

information discussed below.

Form 11–K is an annual report of

certain types of employee benefit plans.

It is filed by an estimated 774

respondents for a total estimated annual

burden of 23,220 hours.

Form T–6 is used to apply under

Section 310(a)(1) of the TIA for

determination of eligibility of a foreign

person to act as institutional trustee. It

is filed by an estimated 15 respondents

for a total estimated annual burden of

255 hours.

General comments regarding the

above information should be directed to

the following persons: (i) Desk Officer

for the Securities and Exchange

Commission, Office of Information and

Regulatory Affairs, Office of

Management and Budget, Room 3208,

New Executive Office Building,

Washington, D.C. 20503; and (ii)

Michael E. Bartell, Associate Executive

Director, Office of Information

Technology, Securities and Exchange

Commission, 450 Fifth Street, N.W.,

Washington, D.C. 20549. Comments

must be submitted to OMB by April 25,

1997.

Dated: March 19, 1997.

Jonathan G. Katz,

Secretary.

[FR Doc. 97–7644 Filed 3–25–97; 8:45 am]

BILLING CODE 8010–01–M

[Release No. IC–22575; International Series

Release No. 1068; 812–10468]

Citibank, N.A., et al.; Notice of

Application

March 20, 1997.

AGENCY: Securities and Exchange

Commission (‘‘SEC’’).

ACTION: Notice of application for

exemption under the Investment

Company Act of 1940 (‘‘1940 Act’’).

APPLICANTS: Citibank, N.A. (‘‘Citibank’’)

and Citicorp.

RELEVANT 1940 ACT SECTIONS: Exemption

requested under section 6(c) from

section 17(f) and rule 17f–5.

SUMMARY OF APPLICATION: Applicants

seek conditional exemptive relief from

section 17(f) of the 1940 Act and rule

17f–5 thereunder. The requested

exemption would allow Citibank to

make available direct and agency

custody arrangements for certain

securities and other assets between

United States investment companies

and Citibank T/O in the Russian

Federation.

FILING DATE: The application was filed

on December 24, 1996. Applicants have

agreed to file an additional amendment

during the notice period, the substance

of which is incorporated herein.

HEARING OR NOTIFICATION OF HEARING: An

order granting the application will be

issued unless the SEC orders a hearing.

Interested persons may request a

hearing by writing to the SEC’s

Secretary and serving applicants with a

copy of the request, personally or by

mail. Hearing requests should be

received by the SEC by 5:30 p.m. on

April 14, 1997, and should be

accompanied by proof of service on

applicants, in the form of an affidavit or,

for lawyers, a certificate of service.

Hearing requests should state the nature

of the writer’s interest, the reason for the

request, and the issues contested.

Persons who wish to be notified of a

hearing may request notification by

writing to the SEC’s Secretary.

ADDRESSES: Secretary, SEC, 450 5th

Street, N.W., Washington, D.C. 20549.

Applicants, c/o Wayne J. Rapozo, Esq.,

Skadden, Arps, Slate, Meagher & Flom

LLP, 919 Third Avenue, New York, New

York 10022–3897.

FOR FURTHER INFORMATION CONTACT:

Joseph B. McDonald, Jr., Senior

Counsel, at (202) 942–0533, or Mary Kay

Frech, Branch Chief, at (202) 942–0564

(Division of Investment Management,

Office of Investment Company

Regulation).

SUPPLEMENTARY INFORMATION: The

following is a summary of the

application. The complete application

may be obtained for a fee at the SEC’s

Public Reference Branch.

Applicants’ Representations

A. Background

1. Citibank, a United States national

banking association, is a wholly-owned

subsidiary of Citicorp, a Delaware bank

holding company. Citibank operates an

extensive custodian network through its

branches and through its own

subsidiaries and subsidiaries of

Citicorp, as well as unaffiliated

correspondent banks. As of December

31, 1995, Citibank had approximately

$966 billion in assets under custody.

2. In 1995, Citibank received

exemptive relief from the Commission

with respect to 15 foreign subsidiaries of

Citibank 1 from the provisions of section

17(f) of the 1940 Act to permit, among

other things, Citibank as the custodian

of securities and other assets (other than

cash) (the ‘‘MIC Securities’’) and cash

(the ‘‘MIC Cash’’) of any registered

management investment company,

incorporated or organized under the

laws of the United States or a state

thereof (‘‘U.S. Investment Company’’),

or as subcustodian of MIC Securities

and MIC Cash for which any other

entity is acting as custodian (the ‘‘MIC

Custodian’’), and such U.S. Investment

Company or MIC Custodian for which

Citibank so acts, to deposit or to cause

to permit the deposit of MIC Securities

and MIC Cash with such foreign

subsidiaries of Citibank (‘‘Agency

Custody Arrangements’’) (the ‘‘1995

Order’’).2

3. The 1995 Order also granted

exemptive relief permitting such foreign

subsidiaries of Citibank to serve as

custodian for U.S. Investment

Companies, or subcustodian of MIC

Securities and MIC Cash for MIC

Custodians, pursuant to direct
Federal Register / Vol. 62, No. 58 / Wednesday, March 26, 1997 / Notices 93

3Clearing and custody procedures in the Russian

Federation differ substantially from the procedures

generally employed in other jurisdictions. Other

than the exemption requested from section 17(f)

and rule 17f–5 so that the Direct Custody

Arrangements and Agency Custody Arrangements

may apply to Citibank T/O in the Russian

Federation, applicants are not requesting an

exemption from section 17(f) or rule 17f–5 for any

aspect of the custody or clearing procedures

employed in the Russian Federation. Furthermore,

applicants acknowledge that any order granting the

application may not be deemed a determination by

the SEC that the Russian clearing and custody

procedures comply with section 17(f) or any rule

thereunder.

contractual arrangements between such

Citibank subsidiary and a U.S.

Investment Company of an MIC

Custodian (‘‘Direct Custody

Arrangements’’).

4. The 1995 Order also provides that

with the exception of Citibank T/O or

any other Citibank subsidiary or affiliate

operating in the Russian Federation, (a)

the relief granted therein with respect to

Agency Custody Arrangements apply to

all additional foreign subsidiaries of

Citibank which do not meet the

shareholders’ equity requirements of

Rule 17f–5 (collectively, the

‘‘Additional Citibank Subsidiaries’’) and

all foreign affiliates of Citibank which

are subsidiaries of Citicorp which do

not meet the shareholders’ equity

requirement of Rule 17f–5 (collectively,

the ‘‘Citibank Affiliates’’) when such

Additional Citibank Subsidiaries and

such Citibank Affiliates meet the terms

and conditions applicable to the

provision of such services set forth in

the 1995 Order and (b) the relief granted

therein with respect to Direct Custody

Arrangements apply to all Additional

Citibank Subsidiaries and, at such time

as direct custody services are to be

offered by them in accordance with

applicable law, the Citibank Affiliates,

when such Additional Citibank

Subsidiaries and such Citibank

Affiliates meet the terms and conditions

applicable to the provision of services

set forth in the 1995 Order.

B. Relief Requested

1. Applicants seek an order under

Section 6(c) of the Act granting

exemptive relief from Section 17(f) of

the Act to allow Citibank T/O in the

Russian Federation to provide foreign

custody services in connection with the

holding of MIC Securities and MIC Cash

of any U.S. Investment Company

pursuant to (1) Agency Custody

Arrangements and (2) Direct Custody

Arrangements.3

2. The Citibank Subsidiaries, the

Additional Citibank Subsidiaries and

the Citibank Affiliates, from time to time

providing custodial services pursuant to

the terms of the 1995 Order, and

Citibank T/O, at such time as it provides

custodial services pursuant to the

requested order, will hereinafter

collectively be referred to as the

‘‘Exemptive Order Network Members’’.

3. Under the Agency Custody

Arrangements, MIC Securities and MIC

Cash are maintained in the custody of

an Exemptive Order Network Member

in accordance with a custody agreement

among (a) the U.S. Investment Company

or MIC Custodian for which Citibank

acts as custodian or subcustodian, (b)

Citibank, and (c) Citicorp (the ‘‘Agency

Custody Agreement’’). Citibank acts as

the custodian or subcustodian of the

MIC Securities and MIC Cash and is

authorized to delegate its

responsibilities to the Exemptive Order

Network Member in accordance with

the terms of a subcustodian agreement

(the ‘‘Subcustodian Agreement’’).

4. The Agency Custody Agreement

provides that the delegation by Citibank

to an Exemptive Order Network Member

does not relieve Citibank of any

responsibility to the U.S. Investment

Company or MIC Custodian for any loss

due to the negligent acts or omissions of

the Exemptive Order Network Member

except such loss as may result from

political risk (e.g., exchange control

restrictions, confiscation, expropriation,

nationalization, insurrection, civil strife

or armed hostilities), and other risk of

loss for which neither Citibank nor the

Exemptive Order Network Member

would be liable under rule 17f–5 (e.g.,

despite the exercise of reasonable care,

loss due to Act of God, nuclear incident

and the like). The Agency Custody

Agreement also provides that Citicorp is

liable, in accordance with the terms of

the guarantee described below, for

losses of MIC Securities and/or MIC

Cash resulting from the bankruptcy or

insolvency of the Exemptive Order

Network Member.

5. The Direct Custody Arrangements

will enable the Exemptive Order

Network Members to act as direct

custodians in accordance with either a

master custody agreement under which

a U.S. Investment Company or MIC

Custodian enters into a direct custodial

relationship with a number of

Exemptive Order Network Members or

an individual custody agreement under

which a U.S. Investment Company or

MIC Custodian enters into a direct

custodial relationship with a particular

Exemptive Order Network Member

(either, a ‘‘Direct Custody Agreement’’).

The Direct Custody Agreement would

be among (i) The U.S. Investment

Company or MIC Custodian for which

the Exemptive Order Network Member

acts as custodian or subcustodian, (ii)

the Exemptive Order Network Member,

(iii) Citicorp, and (iv) Citibank. The

terms of each Direct Custody Agreement

would include a confirmation by the

Exemptive Order Network Member that

it will act as the custodian or

subcustodian, as the case may be, of the

MIC Securities and MIC Cash under the

requested order, an agreement by

Citicorp that it is liable, in accordance

with the terms of its guarantee, for

losses of MIC Securities and MIC Cash

resulting from the bankruptcy or

insolvency of the Exemptive Order

Network Member, and an agreement by

Citibank to be liable for any loss

resulting from the performance of the

Exemptive Order Network Member,

except such loss as may result from

political risk (e.g., exchange control

restrictions, confiscation, expropriation,

nationalization, insurrection, civil strife

or armed hostilities), and other risk of

loss for which neither Citibank nor the

Exemptive Order Network Member

would be liable under rule 17f–5 (e.g.,

despite the exercise of reasonable care,

loss due to Act of God, nuclear incident

and the like).

6. The extent of Citibank’s liability for

losses attributable to Citibank T/O

under the Direct Custody Arrangements

would be the same as that provided for

under the Agency Custody

Arrangements. Under both the Agency

Custody Arrangements and the Direct

Custody Arrangements, Citibank would

be liable for the negligent acts or

omissions of Citibank T/O.

7. Both the Agency and Direct

Custody Agreements would provide that

Citicorp will be liable in accordance

with the terms of a guarantee for losses

of MIC Securities and MIC Cash

resulting from bankruptcy or insolvency

of Citibank T/O. Under the 1995 Order,

Citicorp has issued a guarantee for

losses of MIC Securities and MIC Cash

held by the Exemptive Order Network

Member under the Agency and Direct

Custody Agreements resulting from the

bankruptcy or insolvency of each

Exemptive Order Network Member (the

‘‘Guarantee’’). If the requested order is

issued and Citibank T/O becomes an

Exemptive Order Network Member, the

Guarantee will be amended to cover all

MIC Securities and MIC Cash held by

Citibank T/O. The dollar amount of the

Guarantee applicable to all Exemptive

Order Network Members will equal or

exceed the aggregate market value of

MIC Securities and MIC Cash held in

the custody of the Exemptive Order

Network Members.

8. The value of MIC Securities and

amount of MIC Cash held under Agency

Custody Agreements will be calculated

by Citibank based on records

maintained by Citibank, as custodian,
94 Federal Register / Vol. 62, No. 58 / Wednesday, March 26, 1997 / Notices

and reports by the Exemptive Order

Network Members. The total amount

also will be reported to Citicorp. In

addition, each Exemptive Order

Network Member will submit to

Citibank, as agent for Citicorp, the

Exemptive Order Network Member’s

calculation, and the basis on which it

was made, of the value of MIC

Securities and amount of MIC Cash held

by it under Direct Custody Agreements.

After review of the results of the

monthly monitoring, Citicorp will take

the necessary steps to adjust the amount

of the Guarantee to cover the aggregate

value of the MIC Securities and the

aggregate amount of MIC Cash.

9. In the event that at the time of a

bankruptcy or insolvency an Exemptive

Order Network Member holds MIC

Securities and MIC Cash having an

aggregate value in excess of the

aggregate value of MIC Securities and

MIC Cash which such Exemptive Order

Network Member held at the time of the

previous adjustment of the Guarantee,

Citicorp will immediately take such

steps as may be necessary to increase

the size of the Guarantee to cover the

amount of such excess. This coverage

will remain in place until such time as

the Exemptive Order Network Member’s

bankruptcy estate is settled, the amount

of any loss to the U.S. Investment

Company or MIC Custodian attributable

to the bankruptcy or insolvency is

calculated, and payment under the

Guarantee, if necessary, is made.

Applicants’ Legal Analysis

1. Applicants seek the requested

exemptive relief because Citibank T/O

does not qualify to serve as custodian

for MIC Securities and MIC Cash under

the terms of section 17(f) of the 1940 Act

or rule 17f–5 thereunder. Section 17(f)

provides, in relevant part, that a

registered management investment

company may place and maintain its

securities and similar assets in the

custody of a bank or banks meeting the

requirements of section 26(a) of the

1940 Act. Citibank T/O, however, does

not fall within the definition of a

‘‘bank’’ as that term is defined in section

2(a)(5) of the 1940 Act.

2. Rule 17f–5 would permit a U.S.

Investment Company to deposit

securities, cash and cash equivalents

with an ‘‘eligible foreign custodian,’’ a

term that is defined to include, as here

relevant, a majority-owned direct or

indirect subsidiary of a qualified U.S.

bank or bank holding company that is

incorporated or organized under the

laws of a country other than the United

States and that has shareholders’ equity

in excess of $100,000,000 (U.S.$ or

equivalent). The rule defines the term

‘‘Qualified U.S. Bank’’ to include a

banking institution organized under the

laws of the United States that has an

aggregate capital, surplus, and

undivided profit of not less than

$500,000. Citibank is a Qualified U.S.

Bank as defined in the rule. Citibank T/

O, however, currently does not meet the

minimum shareholders’ equity

requirement of rule 17f–5.

3. Although Citibank will not be in an

agency relationship with Citibank T/O

under the Direct Custody Arrangements,

it nonetheless will provide the

necessary review and independent

oversight of the performance and

capabilities of Citibank T/O. Applicants

submit that Citibank’s review will

insure that adequate safeguards are in

place and that service standards for

custodial administration and operations

are in place. Because Citibank will agree

to be responsible for negligent acts or

omissions of Citibank T/O under the

Agency Custody Arrangements and the

Direct Custody Arrangements, Citibank

will have a vested interest in verifying

that Citibank T/O maintains adequate

standards.

4. Under the Direct Custody

Arrangements, Citibank will be in

privity of contract with the U.S.

Investment Company or MIC Custodian.

While it would be necessary for a U.S.

Investment Company or MIC Custodian

to establish the negligence of Citibank

T/O in the action against Citibank, the

U.S. Investment Company or MIC

Custodian would be entitled to seek

recovery from Citibank in the first

instance.

5. Pursuant to the Agency Custody

Agreement, Citibank acts as the

custodian or subcustodian of MIC

Securities and MIC Cash and is

authorized to delegate its

responsibilities to the Exemptive Order

Network Member in accordance with

the terms of the Subcustodian

Agreement. The Subcustodian

Agreement explicitly provides that U.S.

Investment Companies or MIC

Custodians, as the case may be, that

have entered into an Agency Custody

Agreement with Citibank are third party

beneficiaries of the Subcustodian

Agreement, are entitled to enforce the

terms of the Subcustodian Agreement,

and are entitled to seek relief directly

against the Exemptive Order Network

Member or against Citibank.

6. Applicants believe that provision of

the Guarantee by Citicorp (rather than

by Citibank) under the Agency and

Direct Custody Arrangements does not

negatively affect the level of protection

afforded the U.S. Investment Companies

and MIC Custodians. Since the

Guarantee will be at least equal to the

aggregate value of all MIC Securities and

MIC Cash held by all Exemptive Order

Network Members at the end of the

previous calendar month and the total

Guarantee amount is available to cover

one or more Exemptive Order Network

Members, the Guarantee should be more

than sufficient to cover losses

attributable to the bankruptcy or

insolvency of any one particular

Exemptive Order Network Member.

Applicants’ Conditions

If the requested order is granted,

applicants agree to the following

conditions:

1. The foreign custody arrangements

proposed with respect to Citibank T/O

will satisfy the requirements of rule 17f–

5 in all respects other than with regard

to shareholders’ equity.

2. MIC Securities and MIC Cash

custodied pursuant to Agency Custody

Arrangements will be maintained with

Citibank T/O only in accordance with

an Agency Custody Agreement, required

to remain in effect at all times during

which Citibank T/O fails to satisfy the

requirements of rule 17f–5 relating to

shareholders’ equity.

3. The Agency Custody Agreement

will be among (i) the U.S. Investment

Companies or MIC Custodians for which

Citibank serves as custodians or

subcustodian, (ii) Citibank, and (iii)

Citicorp. The Agency Custody

Agreement will provide the following:

(a) Citibank will act as the custodian or

subcustodian, as the case may be, of the MIC

Securities and MIC Cash and will be able to

delegate its responsibilities to Citibank T/O;

(b) Citibank’s delegation of duties to

Citibank T/O will not relieve Citibank of any

responsibility to the U.S. Investment

Company or MIC Custodian for any loss due

to the negligent performance by Citibank T/

O, except such loss as may result from (i)

political risk (e.g., exchange control

restrictions, confiscation, expropriation,

nationalization, insurrection, civil strife or

armed hostilities) and (ii) other risks of loss

for which neither Citibank nor Citibank T/O

would be liable under rule 17f–5; and

(c) Citicorp will be liable, in accordance

with the terms of the Guarantee, for losses of

MIC Securities and/or MIC Cash resulting

from the bankruptcy or insolvency of

Citibank T/O.

4. With respect to the Agency Custody

Arrangements, Citibank will enter into a

Subcustodian Agreement with Citibank

T/O pursuant to which Citibank will

delegate to Citibank T/O such of its

duties and obligations as would be

necessary to permit Citibank T/O to

hold in custody, in the Russian

Federation, MIC Securities and MIC

Cash. The Subcustodian Agreement will

provide an acknowledgement by

Citibank T/O that it is acting as a foreign
Federal Register / Vol. 62, No. 58 / Wednesday, March 26, 1997 / Notices 95

custodian for U.S. Investment

Companies and MIC Custodians

pursuant to the terms of the exemptive

order requested by the application. The

Subcustodian Agreement will explicitly

provide that U.S. Investment Companies

or MIC Custodians that have entered

into an Agency Custody Agreement with

Citibank will be third party,

beneficiaries of the Subcustodian

Agreement, will be entitled to enforce

the terms thereof, and will be entitled to

seek relief directly against Citibank T/O

or against Citibank.

5. The Subcustodian Agreement

between Citibank and Citibank T/O will

be governed by New York law; or, if it

were governed by the local law of the

Russian Federation, Citibank shall

obtain an opinion of counsel form

Russian counsel opining as to the

enforceability of the rights of a third

party beneficiary under the laws of such

foreign jurisdiction.

6. MIC Securities and MIC Cash of

U.S. Investment Companies and MIC

Custodians entering into Direct Custody

Arrangements with Citibank T/O will be

maintained with Citibank T/O only in

accordance with a Direct Custody

Agreement, required to remain in effect

at all times during which Citibank T/O

fails to satisfy the requirements of rule

17f–5 relating to shareholders’ equity.

7. The Direct Custody Agreement will

be among (i) each U.S. Investment

Company or MIC Custodian for which

Citibank T/O serves as custodian or

subcustodian, (ii) Citibank T/O, (iii)

Citibank, and (iv) Citicorp. The Direct

Custody Agreement will provide the

following:

(a) confirmation by Citibank T/O that it

will act as the custodian or subcustodian, as

the case may be, of the MIC Securities and

MIC Cash pursuant to the requested order;

(b) Citicorp will be liable, in accordance

with the terms of the Guarantee, for losses of

MIC Securities and/or MIC Cash resulting

from the bankruptcy or insolvency of

Citibank T/O; and

(c) Citibank will be liable for any loss

resulting from the performance of Citibank

T/O, except such loss as may result from (i)

political risk (e.g., exchange control

restrictions, confiscation, expropriation,

nationalization, insurrection, civil strife, or

armed hostilities) and (ii) other risks of loss

for which Citibank T/O would not be liable

under rule 17f–5.

8. Under the Direct Custody

Arrangements, U.S. Investment

Companies or MIC Custodians, as the

case may be, will be entitled to seek

relief directly against Citibank or

Citibank T/O.

9. The dollar value of the Guarantee

applicable to the Exemptive Order

Network Members shall be at least equal

to the aggregate value of the MIC

Securities and MIC Cash held in the

custody of such Exemptive Order

Network Members pursuant to the

Direct Custody Agreements and the

Agency Custody Agreements, calculated

at the close of the previous calendar

month. The value of MIC Securities and

MIC Cash held in the custody of the

Exemptive Order Network Members, as

Citibank’s subcustodians, will be

calculated by Citibank based on records

maintained by Citibank and reports by

such Exemptive Order Network

Members as at the end of each calendar

month, and such amount will be

reported to Citicorp. In addition, each

Exemptive Order Network Member will

submit to Citibank, as agent for Citicorp,

monthly its calculation, and the basis on

which it was made, of the market value

of MIC Securities and MIC Cash held in

custody by it under Direct Custody

Agreements. After reviewing the results

of the monthly monitoring, Citicorp will

take such steps as may be necessary to

adjust the amount of the Guarantee to

cover the aggregate value of the MIC

Securities and MIC Cash held by

Exemptive Order Network Members,

under Agency and Direct Custody

Agreements. In the event of the

insolvency of an Exemptive Order

Network Member at a time when the

aggregate value of MIC Securities and

MIC Cash held by such Exemptive

Order Network Member is in excess of

the amount of MIC Securities and MIC

Cash which such Exemptive Order

Network Member held at the prior

calendar month’s end, Citicorp will

immediately take such steps (if any) as

may be necessary to increase the size of

the Guarantee to cover the amount of

such excess.

10. Citibank currently satisfies and

will continue to satisfy the Qualified

U.S. Bank requirement set forth in rule

17f–5(c)(3).

For the Commission, by the Division of

Investment Management, under delegated

authority.

Jonathan G. Katz,

Secretary.

[FR Doc. 97–7647 Filed 3–25–97; 8:45 am]

BILLING CODE 8010–01–M

[Release No. IC–22576; File No. 812–10462]

Cova Financial Services Life Insurance

Company, et al.

March 20, 1997.

AGENCY: Securities and Exchange

Commission (‘‘SEC’’ or ‘‘Commission’’).

ACTION: Notice of application for

exemption under the Investment

Company Act of 1940 (the ‘‘1940 Act’’).

APPLICANTS: Cova Financial Services

Life Insurance Company (‘‘Cova Life’’)

and Cova Variable Annuity Account

One (‘‘Variable Account One’’)

RELEVANT 1940 ACT SECTIONS: Order

requested pursuant to Section 26(b)

approving the proposed substitution of

securities.

SUMMARY OF APPLICATION: Applicants

seek an order approving the proposed

substitution of shares of the

International Equity Portfolio of Cova

Series Trust (‘‘Cova Trust’’) for shares of

the Global Equity Portfolio of Lord

Abbett Series Fund, Inc. (‘‘Lord Abbett

Fund’’) which currently are held by

Variable Account One to fund certain

single purchase payment and flexible

purchase payment variable annuity

contracts (‘‘Contracts’’) issued by Cova

Life.

FILING DATE: The application was filed

on December 13, 1996, and amended

and restated on march 18, 1997.

HEARING OR NOTIFICATION OF HEARING: An

order granting the application will be

issued unless the Commission orders a

hearing. Interested Persons may request

a hearing by writing to the Secretary of

the Commission and serving Applicants

with a copy of the request, personally or

by mail. Hearing requests should be

received by the Commission by 5:30

p.m., on April 14, 1997, and should be

accompanied by proof of service on

Applicants in the form of an affidavit or,

for lawyers, a certificate of service.

Hearing requests should state the nature

of the requester’s interest, the reason for

the request, and the issue contested.

Persons may request notification of a

hearing by writing to the Secretary of

the SEC.

ADDRESSES: SEC, Secretary, 450 Fifth

Street, NW., Washington, D.C. 20549.

Applicants, c/o Raymond A. O’Hara III,

Blazzard, Grodd & Hasenauer, P.C., P.O.

Box 5108, Westport, Connecticut,

06881. Copies to Jeffery K. Hoelzel, Esq.,

Senior Vice President, General Counsel

and Secretary, Cova Financial Services

Life Insurance Company, One Tower

Lane, Suite 3000, Oakbrook Terrace, Il

60181–4644.

FOR FURTHER INFORMATION CONTACT:

Megan L. Dunphy, Staff Attorney, or

Patrice M. Pitts, Branch Chief, Office of

Insurance Products, Division of

Investment Management, at (202) 942–

0670.

SUPPLEMENTARY INFORMATION: Following

is a summary of the application. The

complete application may be obtained

for a fee from the Public Reference

Branch of the SEC.