SUBMITTED BY E-MAIL & U.S. MAIL

December 6, 2000

Mr. Jonathan G. Katz
Secretary
Securities Exchange Commission
450 Fifth Street, North West
Washington, D.C. 20549-0609

Re: Comments Regarding File No. S7-18-00

Dear Secretary Katz:

The Commission of the Securities and Exchange ("SEC") has requested comment on the addition of proposed rule 240.17Ad-19, and amendments to rules 240.17f-1 and 240.17Ad-12. These proposals are intended to improve the tracking of securities certificates by transfer agents and to provide for efficient and secure certificate processing. The following comments and inquiries are submitted on behalf of U.S. Bank Trust National Association ("U.S. Bank").

• As proposed, the definition of "securities certificates" in section 240.17f-1(a)(6), is incorporated by reference in modifications to rule 240.17Ad-12 and proposed rule 240.17Ad-19. We seek clarification as to whether the term "securities certificates" is intended to mean both registered and bearer certificates or only registered securities. U.S Bank believes that if the proposed addition to and modification of the rules applied to bearer securities and coupons, transfer agents would be unduly burdened. In order to cancel bearer coupons, transfer agents would be required to stamp manually each coupon versus submitting coupons through an automated system. Such a method would be labor intensive, particular for transfer agents who process large volumes of bearer coupons. If the SEC intends that the term "securities certificates" include bearer bonds, we strongly recommend the final rules allow for discretion; specifically, we suggest the SEC consider and endorse "hole punching" of coupons as an acceptable method of cancellation.

• The SEC proposes to modify rule 240.17f-1(c)(2) to require delivering agents to report securities as missing, stolen, or lost within ten business days after shipment. We recommend extending the time to report to twenty business days as shipments often take longer than ten days to reach destination. Twenty-business days would allow a transfer agent adequate time for the shipment to be delivered and would provide the delivering agent sufficient time to determine the reason for the delay before reporting the shipment as missing, stolen or lost. We also suggest the SEC consider requiring the receiving party to acknowledge receipt of the shipment of securities within five business days. Prompt notification by the receiving party would increase the delivering agent's ability to determine, in a timely manner, whether certificates were lost, stolen, or otherwise missing.

• The SEC has requested comments on the recommendation from members of the securities industry to prohibit the practice of stamping certificates "cancelled in error" versus issuing a new security. We support the adoption of this rule in regards to registered securities. However, if the SEC determines that the term "securities certificates" includes bearer bonds and coupons, U.S. Bank would not support prohibition of this practice as it applies to bearer certificates. Because extra inventory for bearer securities certificates and coupons is usually not available for re-issuance or replacement, transfer agents would be forced to reprint the inventory. Such a practice would be costly, time consuming, and burdensome to the agent and the bondholder.

In closing, we appreciate your consideration of our comments and inquiries.

Very Truly Yours

Daniel M. Hill
Assistant Vice President