A bank is exempt from the definition of the term “broker” under section 3(a)(4) of the Act (15 U.S.C. 78c(a)(4)), to the extent that, as an agent, it engages in or effects securities lending transactions, and any securities lending services in connection with such transactions, with or on behalf of a person the bank reasonably believes to be:

A qualified investor as defined in section 3(a)(54)(A) of the Act (15 U.S.C. 78c(a)(54)(A)); or

Any employee benefit plan that owns and invests on a discretionary basis, not less than $ 25,000,000 in investments.

Securities lending transaction means a transaction in which the owner of a security lends the security temporarily to another party pursuant to a written securities lending agreement under which the lender retains the economic interests of an owner of such securities, and has the right to terminate the transaction and to recall the loaned securities on terms agreed by the parties.

Securities lending services means:

Selecting and negotiating with a borrower and executing, or directing the execution of the loan with the borrower;

Receiving, delivering, or directing the receipt or delivery of loaned securities;

Receiving, delivering, or directing the receipt or delivery of collateral;

Providing mark-to-market, corporate action, recordkeeping or other services incidental to the administration of the securities lending transaction;

Investing, or directing the investment of, cash collateral; or

Indemnifying the lender of securities with respect to various matters.