Chapter 1111 | Trust Companies

Title 11 Banks-Savings and Loan Associations

Section
Section 1111.01 \| Trust company definitions. Effective: January 1, 2018 Latest Legislation: House Bill 49 - 132nd General Assembly PDF: Download Authenticated PDF As used in this chapter: (A) "Charitable trust" means a charitable remainder annuity trust as defined in section 664(d) of the Internal Revenue Code, a charitable remainder unitrust as defined in section 664(d) of the Internal Revenue Code, a charitable lead or other split interest trust subject to the governing instrument requirements of section 508(e) of the Internal Revenue Code, a pooled income fund as defined in section 642(c) of the Internal Revenue Code, a trust that is a private foundation as defined in section 509 of the Internal Revenue Code, or a trust of which each beneficiary is a charity. For purposes of this division and division (B) of this section, "Internal Revenue Code" means the "Internal Revenue Code of 1986," 100 Stat. 2085, 26 U.S.C.A. 1, as amended. (B) "Charity" means a state university as defined in section 3345.011 of the Revised Code, a community college as defined in section 3354.01 of the Revised Code, a technical college as defined in section 3357.01 of the Revised Code, a state community college as defined in section 3358.01 of the Revised Code, a private college or university that possesses a certificate of authorization issued pursuant to Chapter 1713. of the Revised Code, a trust or organization exempt from taxation under section 501(c)(3) or section 501(c)(13) of the Internal Revenue Code, or a corporation, trust, or organization described in section 170(c)(2) of the Internal Revenue Code. The term "charities" means more than one trust or organization that is a charity. (C) "Collective investment fund" means a fund established by a trust company or an affiliate of a trust company for the collective investment of assets held in a fiduciary capacity, either alone or with one or more cofiduciaries, by the establishing trust company and its affiliates. (D) "Fiduciary investment company" means a corporation that is both of the following: (1) An investment company; (2) Incorporated, owned, and operated in accordance with rules adopted by the superintendent of financial institutions for the investment of funds held by trust companies in a fiduciary capacity and for true fiduciary purposes, either alone or with one or more cofiduciaries. (E) "Home" has the same meaning as in section 3721.10 of the Revised Code. (F) "Instrument" includes any will, declaration of trust, agreement of trust, agency, or custodianship, or court order creating a fiduciary relationship. (G) "Residential facility" has the same meaning as in section 5123.19 of the Revised Code. (H) "Investment company" means any investment company as defined in section 3 and registered under section 8 of the "Investment Company Act of 1940," 54 Stat. 789, 15 U.S.C.A. 80a-3 and 80a-8, as amended. (I) "Trust business" means accepting and executing trusts of property, serving as a trustee, executor, administrator, guardian, receiver, or conservator, and providing fiduciary services as a business. "Trust business" does not include any of the following: (1) Any natural person acting as a trustee, executor, administrator, guardian, receiver, or conservator pursuant to appointment by a court of competent jurisdiction; (2) Any natural person serving as a trustee who does not hold self out to the public as willing to act as a trustee for hire. For purposes of division (I) of this section, the solicitation or advertisement of legal or accounting services by a person licensed in this state as an attorney or a person holding an Ohio permit to practice public accounting issued under division (A) of section 4701.10 of the Revised Code shall not be considered to be the act of holding self out to the public as willing to act as a trustee for hire. (3) A charity, an officer or employee of a charity, or a person affiliated with a charity, serving as trustee of a charitable trust of which the charity, or another charity with a similar purpose, is a beneficiary; (4) Any natural person, home, or residential facility serving as trustee or taking other actions relative to a qualified income trust described in section 1917(d)(4)(B) of the "Social Security Act," 42 U.S.C. 1396p(d)(4)(B), as amended; (5) Other fiduciary activities the superintendent determines are not undertaken as a business.
Section 1111.02 \| Authority to solicit or engage in trust business. Effective: January 1, 2018 Latest Legislation: House Bill 49 - 132nd General Assembly PDF: Download Authenticated PDF (A) Except as provided in division (B) of this section, no person shall solicit or engage in trust business in this state except a corporation that is one of the following: (1) A corporation licensed under section 1111.06 of the Revised Code that is one of the following: (a) A state bank; (b) A bank authorized to accept and execute trusts and doing business under authority granted by the bank chartering authority of another state or country; (c) A corporation organized under the laws of another state or country and authorized to accept and execute trusts in that state or country. (2) A national bank or federal savings association authorized to accept and execute trusts and doing business under authority granted by the office of the comptroller of the currency. (B) This chapter shall not apply to a corporation that is incorporated under the laws of another state or the United States, has its principal place of business in another state, is currently qualified to do and is engaging in trust business in the state where the corporation has its principal place of business, and is doing any of the following: (1) Serving as ancillary executor or administrator of property in this state that is in the estate of a decedent, after appointment as executor or administrator of the estate by the courts of the decedent's state of residence; (2) As trustee, acquiring, holding, or transferring a security interest in lands or other property in this state, by mortgage, deed of trust, or other instrument, to secure any evidence of indebtedness; (3) Certifying to any evidence of indebtedness.
Section 1111.03 \| Authority of national bank or federal savings association. Effective: January 1, 2018 Latest Legislation: House Bill 49 - 132nd General Assembly PDF: Download Authenticated PDF (A) Notwithstanding any other provision of the Revised Code, any national bank or federal savings association that has been granted fiduciary powers by the office of the comptroller of the currency may act in this state as trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, receiver, or in any other fiduciary capacity in which trust companies qualified and licensed under section 1111.06 of the Revised Code are authorized to act in this state. For such purpose, a national bank or federal savings association shall have the same powers and rights, including but not limited to, the same right to make and accept transfers of fiduciary appointments, as are granted by the laws of this state to trust companies qualified and licensed under section 1111.06 of the Revised Code, and may solicit trust business, accept trust deposits, and maintain nonbranch trust offices in this state. A national bank or federal savings association shall not, by virtue of conducting such trust activity in this state, be subject to examination or inspection by the superintendent of financial institutions, nor shall it be required to obtain any approval, authorization, licenses, or certification from, or pay any fee or assessment to, the superintendent in order to conduct trust activities in this state. (B) Notwithstanding the provisions of division (A) of this section, section 1111.04, division (B) of section 1111.07, and section 1111.08 of the Revised Code shall apply to national banks and federal savings associations.
Section 1111.04 \| Trust company pledging securities. Effective: October 3, 2023 Latest Legislation: House Bill 33 - 135th General Assembly PDF: Download Authenticated PDF (A) Prior to soliciting or engaging in trust business in this state, a trust company shall pledge to the superintendent of financial institutions interest bearing securities authorized in division (B) of this section, having a par value, not including unaccrued interest, of one hundred thousand dollars, and approved by the superintendent. The trust company may pledge the securities either by delivery to the superintendent or by placing the securities with a qualified trustee for safekeeping to the account of the superintendent of financial institutions, the corporate fiduciary, and any other person having an interest in the securities under Chapter 1109. of the Revised Code, as their respective interests may appear and be asserted by written notice to or demand upon the qualified trustee or by order of judgment of a court. (B) Securities pledged by a trust company to satisfy the requirements of division (A) of this section shall be one or more of the following: (1) Bonds, notes, or other obligations of or guaranteed by the United States or for which the full faith and credit of the United States is pledged for the payment of principal and interest; (2) Bonds, notes, debentures, or other obligations or securities issued by any agency or instrumentality of the United States; (3) General obligations of this or any other state of the United States or any subdivision of this or any other state of the United States. (C) The superintendent of financial institutions shall review, approve, and accept delivery of securities pursuant to this section and shall issue a written acknowledgment of the delivery of the securities or the qualified trustee's receipt and the superintendent's approval to the trust company. (D) The superintendent shall approve securities to be pledged by a trust company pursuant to this section if the securities are all of the following: (1) Interest bearing and of the value required by division (A) of this section; (2) Of one or more of the kinds authorized by division (B) of this section and not a derivative of or merely an interest in any of those securities; (3) Not in default. (E) The superintendent of financial institutions shall permit a trust company to pledge securities in substitution for securities pledged pursuant to this section and the withdrawal of the securities substituted for so long as the securities remaining pledged satisfy the requirements of division (A) of this section. The superintendent shall permit a trust company to collect interest paid on securities pledged pursuant to this section so long as the trust company is solvent. The superintendent shall permit a trust company to withdraw securities pledged pursuant to this section when the trust company has ceased to solicit or engage in trust business in this state. (F) For purposes of this section, a qualified trustee is a federal reserve bank, a federal home loan bank, a trust company as defined in section 1101.01 of the Revised Code, or a national bank or federal savings association that has pledged securities pursuant to this section, is authorized to accept and execute trusts, and is doing business under authority granted by the office of the comptroller of the currency. However, a national bank or federal savings association doing business under authority granted by the office of the comptroller of the currency or a trust company may not act as a qualified trustee for securities it or any of its affiliates is pledging pursuant to this section. (G) The superintendent, with the approval of the attorney general, shall prescribe the form of all receipts and acknowledgments provided for by this section, and upon request shall furnish a copy of each form, with the superintendent's certification attached, to each qualified trustee eligible to hold securities for safekeeping under this section. Last updated August 30, 2023 at 9:31 AM
Section 1111.05 \| Individual, schedule, or blanket fidelity bonds for employees and officers. Effective: January 1, 1997 Latest Legislation: House Bill 538 - 121st General Assembly PDF: Download Authenticated PDF Prior to soliciting or engaging in trust business in this state, and at all times while engaging in trust business in this state, a trust company shall have all of the following: (A) Individual, schedule, or blanket fidelity bonds in favor of the trust company covering each of the trust company's employees and officers in an amount reasonable for the size and nature of the trust company's business; (B) Capital, in combination with other financial support such as insurance in favor of the trust company against errors and omissions by any of the trust company's employees and officers, adequate for the size and nature of the trust company's business; (C) Management and personnel adequate in number and qualifications for the size and nature of the trust company's business.
Section 1111.06 \| Applying for trust company license. Effective: January 1, 2018 Latest Legislation: House Bill 49 - 132nd General Assembly PDF: Download Authenticated PDF (A) Any person, other than a national bank with trust powers or a federal savings association with trust powers, proposing to solicit or engage in trust business in this state shall apply to the superintendent of financial institutions to be licensed as a trust company. The superintendent shall approve or disapprove the application within sixty days after accepting it. (B) In determining whether to approve or disapprove an application for a trust company license, the superintendent shall consider all of the following: (1) Whether the applicant is a corporation described in division (A)(1) of section 1111.02 of the Revised Code; (2) Whether the applicant's articles of incorporation or association authorize the applicant to serve as a trustee; (3) If the applicant is not a state bank, whether the applicant is currently qualified to do and is engaging in trust business in the state or country under the laws of which the applicant is organized; (4) Whether the applicant satisfies the requirements of section 1111.05 of the Revised Code; (5) Whether it is reasonable to believe the applicant will comply with applicable laws and observe sound fiduciary standards in conducting trust business in this state; (6) If the applicant is not a state bank, whether the applicant is subject to comprehensive supervision and regulation of its fiduciary activities by appropriate authorities of the state or country under the laws of which the applicant is organized. (C) In approving an application for a trust company license, the superintendent may impose any condition the superintendent determines to be appropriate. (D) When an applicant has satisfied all prior conditions imposed by the superintendent in approving the applicant's application for a trust company license and has pledged securities as required by section 1111.04 of the Revised Code, the superintendent shall issue the applicant a trust company license. A license issued pursuant to this section shall remain in force and effect until surrendered by the licensee pursuant to section 1111.31 of the Revised Code or suspended or revoked by the superintendent pursuant to section 1111.32 of the Revised Code.
Section 1111.07 \| No transferring or assigning license. Effective: January 1, 2018 Latest Legislation: House Bill 49 - 132nd General Assembly PDF: Download Authenticated PDF (A) A trust company's license to solicit or engage in trust business in this state is not transferable or assignable. (B) Subject to section 2109.28 of the Revised Code, if any trust company enters into a merger or consolidation in which the trust company is not the surviving corporation, or transfers all or substantially all of its assets and liabilities to another corporation, the resulting, surviving, or transferee corporation shall succeed the trust company as fiduciary as a matter of law and without necessity to do anything further, if the resulting, surviving, or transferee corporation is a trust company or a national bank or federal savings association authorized to accept and execute trusts and doing business under authority granted by the office of the comptroller of the currency. If the trust company is not the surviving corporation of a merger, enters a consolidation, or after transferring substantially all of its assets and liabilities ceases to solicit or engage in trust business in this state, the trust company shall surrender its trust company license in accordance with section 1111.31 of the Revised Code.
Section 1111.08 \| Transferring fiduciary account or relationship. Effective: January 1, 2018 Latest Legislation: House Bill 49 - 132nd General Assembly PDF: Download Authenticated PDF (A) A trust company, or a national bank or federal savings association authorized to accept and execute trusts and doing business under authority granted by the office of the comptroller of the currency may transfer all or part of its trust business in this state to another trust company or to a national bank or federal savings association authorized to accept and execute trusts and doing business under authority granted by the office of the comptroller of the currency, if all of the following have occurred: (1) Not less than sixty days before consummation of the transfer, either the transferor or transferee, or both, for each fiduciary account or relationship to be transferred, has given written notice, by regular mail to the most recent address shown on the records of the transferor, to all of the following that apply: (a) Each court having jurisdiction over the fiduciary account or relationship; (b) Each cofiduciary of the fiduciary account or relationship; (c) Each surviving settlor of the trust; (d) Each person that, alone or in conjunction with others, has the power to remove the trust company as fiduciary or appoint a successor fiduciary; (e) Except in the case of a trust described in section 401(a) of the "Internal Revenue Code of 1986," 100 Stat. 2085, 26 U.S.C.A. 401(a), as amended, each adult beneficiary currently receiving or entitled as a matter of right to receive a distribution of principal or income from the trust, estate, or fund; (f) In the case of a trust described in section 401(a) of the "Internal Revenue Code of 1986," 100 Stat. 2085, 26 U.S.C.A. 401(a), as amended, the employer or employee organization, or both, responsible for the maintenance of the trust. (2) The transferor has filed a certified copy of the agreement for the sale with the superintendent of financial institutions. (B)(1) The transfer of a fiduciary account or relationship pursuant to division (A) of this section results in the transferee being substituted for the transferor as fiduciary as a matter of law and without necessity to do anything further. (2) The transfer of a fiduciary account or relationship pursuant to division (A) of this section does neither of the following: (a) Impair the right of any person that, alone or in conjunction with others, has the power to remove a fiduciary or appoint a successor fiduciary; (b) Absolve or discharge a transferor from any liability arising out of its breach of any fiduciary duty or obligation to the account prior to the transfer.
Section 1111.09 \| Trust service offices. Effective: January 1, 2018 Latest Legislation: House Bill 49 - 132nd General Assembly PDF: Download Authenticated PDF (A)(1) A trust service office is any location established by a trust company as a place for either of the following: (a) Persons seeking the services of the trust company, or information about those services, to contact representatives of the trust company regarding the trust company's business. (b) The trust company's representatives to contact the trust company's customers, or potential customers, and their representatives. (2) None of the following is a trust service office: (a) Any location where a trust company conducts its operations but does not provide facilities for contact with its customers or contact by the public with the trust company; (b) Any location that is the home or place of work or business or used for the convenience of the trust company's customer, potential customer, or a representative of a customer or potential customer where the trust company's representative's contact with its customer, potential customer, or a representative of a customer or potential customer is merely incidental to the purposes for which the location is maintained and to the activities conducted there; (c) Any location where another person, including a financial institution, conducts its business and persons inquiring about trust services are merely referred to a trust company, even if referrals to a particular trust company are by exclusive arrangement and compensated. (B) A trust company may, consistent with the trust company's safe and sound operation and the law, establish and maintain trust service offices at any location, including the following: (1) If clearly identified and distinguished, at a location where another person, including a financial institution, also conducts business; (2) If the trust company is a bank, savings and loan association, or savings bank, at any of its approved banking offices or main office or branches. (C)(1) A trust company shall give notice in writing to the superintendent of financial institutions prior to establishing, relocating, or closing a trust service office in this state. (2) A trust company that is a state bank also shall give notice in writing to the superintendent prior to establishing, relocating, or closing a trust service office outside this state.
Section 1111.11 \| Trust company - powers and duties. Effective: January 1, 1997 Latest Legislation: House Bill 538 - 121st General Assembly PDF: Download Authenticated PDF A trust company may receive and hold moneys or property, in trust or as custodian, from executors, administrators, assignees, guardians, trustees, corporations, or individuals, and engage in those activities constituting the trust business, and any activities incidental to the trust business, including any of the following: (A) Acting as trustee under any instrument creating a trust for the care and management of property under the same circumstances and in the same manner as any other trustee; (B) Accepting and executing any trusts, duties, and powers that may be granted to it regarding holding, managing, investing, or disposing of any property, real or personal, that may be committed or transferred to or vested in a trust estate and any rents, income, profits, and proceeds of that property or the sale of that property; (C) Accepting and executing all trusts committed to it by order of any court of any state, the United States, or any country, to act as executor, administrator, assignee, guardian, receiver, or trustee, or in any other fiduciary capacity, and taking title to any real estate that is the subject of any trust committed to it by any court; (D) Acting as agent for holding, managing, investing, or disposing of any property, real or personal, and any rents, income, profits, or proceeds of that property or the sale of that property; (E) Acting as trustee under any mortgage, deed of trust, or indenture for securing bonds or other debt securities issued by any corporation, association, state, county, municipal corporation, or political subdivision; (F) Accepting and executing any other corporate or municipal trusts; (G) Acting as agent or trustee for registering, countersigning, or transferring certificates of stock, bonds, or other evidences of indebtedness of a corporation, association, state, county, municipal corporation, or political subdivision.
Section 1111.12 \| Use of trust companies by courts. Effective: January 1, 1997 Latest Legislation: House Bill 538 - 121st General Assembly PDF: Download Authenticated PDF (A) Any court in this state may direct moneys or property that are under its control, paid into court by parties to legal proceedings, or brought into court by reason of an order, judgment, or decree, to be placed with a trust company for safekeeping. (B) Any court in this state may appoint a trust company to act as executor, administrator, assignee, guardian, receiver, or trustee, or in any other fiduciary capacity, for any estate or property of any kind. (C) No trust company shall be required by a court to assume or execute any trust the trust company has not consented to assume or execute.
Section 1111.13 \| Investing of trust funds. Effective: January 1, 2007 Latest Legislation: House Bill 416 - 126th General Assembly PDF: Download Authenticated PDF (A)(1) Except as provided in divisions (A)(2) and (G) of this section or as otherwise provided by the instrument creating the trust, a trust company acting as fiduciary under any instrument and having funds of the trust which are to be invested may, in addition to any other investments authorized to a trust company by law, invest them in any of the following: (a) Forms of investments enumerated or described in, or made eligible for investment by, the Ohio Uniform Prudent Investor Act and sections 2109.37, 2109.371, 2109.372, and 5815.26 of the Revised Code, including, but not limited to, securities, stocks, bonds, or certificates of deposit issued by the trust company or any bank owned or controlled by the bank holding company that owns or controls the trust company. (b) Any collective investment fund established and maintained by the trust company or by an affiliate of the trust company; (c) The securities of any investment company, including any affiliated investment company, whether or not the trust company has invested other funds held by it in an agency or other nonfiduciary capacity in the securities of the same investment company or affiliated investment company. (2) A trust company acting as fiduciary may not invest its trust funds in stock issued by the fiduciary itself except under one of the following circumstances: (a) In the case of a testamentary instrument, when expressly permitted by the instrument creating the relationship and authorized by court order; (b) In the case of an inter vivos instrument, when expressly permitted by the instrument or authorized by court order and in either case, only when directed to purchase or invest in the stock by a cofiduciary or other person other than the trust company who has the right under the terms of the instrument to direct the investment; (c) When exercising rights to purchase its own stock or to purchase or convert securities convertible into its own stock if the rights were offered pro rata to the shareholders; (d) To complement fractional shares acquired when the exercise of rights or receipt of a stock dividend results in fractional shareholdings. (3) If the law or the instrument creating a trust expressly permits investment in direct obligations of the United States or an agency or instrumentality of the United States, unless expressly prohibited by the instrument, a trust company also may invest in no front end load money market mutual funds consisting exclusively of obligations of the United States or an agency or instrumentality of the United States and in repurchase agreements, including those issued by the trust company itself, secured by obligations of the United States or an agency or instrumentality of the United States, or in securities of other no load money market mutual funds whose portfolios are similarly restricted; and in collective investment funds established in accordance with section 1111.14 of the Revised Code or by an affiliate of the trust company and consisting exclusively of any direct obligations of the United States or an agency or instrumentality of the United States, notwithstanding division (A)(1)(c) of that section. (B) A trust company acting in any fiduciary capacity or under any instrument has the right to retain any part of the trust or estate it receives, whether from the creator of the trust or the estate, at its inception or by later addition, or by addition by any other person who is authorized to make additions to the trust or estate, and any investments the trust company makes. (C) Except as otherwise expressly provided by the instrument creating the fiduciary relationship, any trust company may exercise all voting, consenting, and dissenting rights, including the right to vote for the election of directors, pertaining to stocks, bonds, or other securities held by it in any fiduciary capacity, including rights pertaining to stocks, bonds, or other securities issued by the trust company in its individual corporate capacity and held by it in any fiduciary capacity, provided: (1) In the case of any fiduciary relationship created prior to January 1, 1968, voting rights pertaining to any shares of a trust company's own stock held by it in a fiduciary relationship, if exercised, shall be exercised with respect to the election of directors, only in accordance with any provisions of law applicable to that election and without regard to the first paragraph of division (C) and divisions (C)(2)(a), (b), and (c) of this section, and those portions of division (C) of this section shall not be construed to be determinative of the voting rights or to be declaratory of a public policy with respect to the voting rights. (2) In the case of any fiduciary relationship created on or after January 1, 1968, voting rights pertaining to any shares of a trust company's own stock held by it in a fiduciary relationship shall be exercised by it with respect to the election of directors, only if and as directed in writing by any person described in division (C)(2)(a), (b), or (c) of this section, provided that the person may not be the trust company, or a director, officer, or employee of the trust company except as to fiduciary relationships in which the director, officer, or employee is a settlor or beneficiary, or a nominee, agent, attorney, or subsidiary of the trust company: (a) Any person, including a settlor or beneficiary, who has the right under the terms of the instrument under which shares are held to determine the manner in which shares shall be voted, or if there is no such person; (b) Any person acting as cofiduciary under the instrument under which such shares are held, or if there is no such person; (c) Any person, having the right of revocation or amendment of the instrument under which the shares are held. (D) If there is more than one person having power to direct voting under division (C)(2)(a), (b), or (c) of this section and they fail to agree, each person shall have the right to direct voting with respect to the election of directors as to an equal number of shares. (E) As used in this section: (1) "Affiliated investment company" means any investment company that is any of the following: (a) Sponsored by the trust company that is acting as fiduciary or by a trust company, bank, bank subsidiary corporation, or other corporation owned or controlled by the bank holding company that owns or controls the trust company that is acting as fiduciary; (b) The result of any agreement with a trust company, bank, bank subsidiary corporation, or other corporation owned or controlled by the bank holding company that owns or controls the trust company that is acting as fiduciary; (c) Established exclusively for the customers or accounts of the trust company that is acting as fiduciary or of a trust company, bank, bank subsidiary corporation, or other corporation owned or controlled by the bank holding company that owns or controls the trust company that is acting as fiduciary; (d) Provided with investment advisory, brokerage, transfer agency, registrar, management, shareholder servicing, custodian, or any related services by the trust company that is acting as fiduciary or by a trust company, bank, bank subsidiary corporation, or other corporation owned or controlled by the bank holding company that owns or controls the trust company that is acting as fiduciary. (2) "Cofiduciary" includes, but is not limited to, a cotrustee, coexecutor, coadministrator, coguardian, co-agent, and any person who, under the terms of the instrument creating the fiduciary relationship, has the right or power to direct, approve or consent to, or be consulted with respect to, the making, retention, or sale of investments under the instrument. (3) "Instrument" includes, but is not limited to, any will, declaration of trust, agreement of trust, agency, or custodianship, or court order creating a fiduciary relationship. (4) "Reasonable fee" means compensation or payment, the receipt of which would not constitute a breach of fiduciary duty under section 36 of the "Investment Company Act of 1940," 54 Stat. 789, 15 U.S.C.A. 80a-35. (F) Shares as to which the voting rights with respect to the election of directors may not be exercised under this section shall not be considered as outstanding for the purpose of computing the voting power of the corporation or of its shares of any class with respect to the election of directors. (G) This section does not authorize a trust company acting as a probate fiduciary to perform any act prohibited by section 2109.44 of the Revised Code, unless the act is authorized by the instrument creating the trust. (H) A trust company making an investment of trust funds in an affiliated investment company, or a bank or other corporation owned or controlled by the bank holding company that owns or controls the trust company, may charge a reasonable fee for investment advisory, brokerage, transfer agency, registrar, management, shareholder servicing, custodian, or any related services provided to an affiliated investment company. The fee may be in addition to the compensation that the trust company is otherwise entitled to receive from the trust, provided that the fee is charged as a percentage of either asset value or income earned or actual amount charged and is disclosed at least annually by prospectus, account statement, or any other written means to all persons entitled to receive statements of account activity. (I) A trust company making an investment of trust funds in the securities of an affiliated investment company pursuant to division (A)(1)(c) of this section shall, when providing any periodic account statements to the trust fund, report the net asset value of the shares comprising the investment of the trust fund in the affiliated investment company. (J) If a trust company making an investment of trust funds in the securities of an affiliated investment company pursuant to division (A)(1)(c) of this section invests the funds in any mutual fund, the trust company shall disclose, in at least ten-point boldface type, by prospectus, account statement, or any other written means to all persons entitled to receive statements of account activity, that the mutual fund is not insured or guaranteed by the federal deposit insurance corporation or by any other government agency or government-sponsored agency of the federal government or of this state.
Section 1111.14 \| Collective investments. Effective: January 1, 2007 Latest Legislation: House Bill 416 - 126th General Assembly PDF: Download Authenticated PDF A trust company may do any of the following: (A) Collectively invest assets it holds in any fiduciary capacity in any investment authorized by the superintendent of financial institutions, subject to all of the following conditions that apply: (1) The collective investment is not prohibited by the instrument, judgment, decree, or order creating the fiduciary relationship for any of the following reasons: (a) The investment is being made collectively; (b) The character of some or all of the other fiduciary relationships for which assets are also invested; (c) Any relationship, other than as an investing fiduciary, the trust company or any affiliate of the trust company has to the investment; (d) Any relationship any other person has to the collective investment. (2) The collective investment is a proper investment for the assets. In determining whether the collective investment is a proper investment for the assets, the collective investment shall be considered as a whole, with consideration being given to all assets held in the collective investment, and the inclusion of any asset that would not independently be a proper investment shall not be determinative. (3) If the trust company is not the sole fiduciary of the assets, the trust company has procured the written consent of the cofiduciaries to the investment. Any person serving with a trust company as a cofiduciary of property in this state has the authority to consent to the investment of the property in a collective investment vehicle that either is established or managed by the cofiduciary trust company or an affiliate of the cofiduciary trust company or in which the cofiduciary participates in the formation, ownership, or operation. (B) Establish and maintain one or more collective investment funds, consistent with regulations adopted by the comptroller of the currency and rules adopted by the superintendent, for the collective investment of assets held by the trust company or any of its affiliates in any fiduciary capacity, to which funds both of the following apply: (1) The trust company may charge a reasonable fee for the management of a collective investment fund, provided that the amount of the fee shall not exceed an amount commensurate with the value of legitimate services of tangible benefit to the participant that the participant would not have received if no assets of the participant had been invested in participations in the fund. However, in the case of investments by a collective investment fund in an affiliated investment company, the trust company may charge a fee as provided in division (B)(2) of this section. Any fee received by the trust company may be charged either to the income or principal of the fund or apportioned between them. The trust company may charge a fee for reasonable expenses incurred in the administration of the fund. A trust company shall not charge a fee for expenses incurred in establishing or reorganizing the fund. (2) A collective investment fund may invest in any affiliated investment company, provided that any fee that is paid to the trust company or person owned or controlled by the bank holding company that owns or controls the trust company is a reasonable fee for the services provided. Any such fee may be in addition to compensation that the trust company is otherwise entitled to receive. A collective investment fund that invests in an affiliated investment company shall, when providing any periodic account statements to the trust fund, report the net asset value of the shares comprising the investment of the trust fund in the affiliated investment company. If a collective investment fund invests in an affiliated investment company, the collective investment fund shall disclose, in at least ten-point boldface type, by prospectus, by annual account statement, or by any other written means to all persons entitled to receive statements of account activity, that the affiliated investment company is not insured or guaranteed by the federal deposit insurance corporation or by any other government agency or government-sponsored agency of the federal government or of this state. (C) Participate in the formation, ownership, or operation of one or more fiduciary investment companies established and operated in accordance with rules adopted by the superintendent.
Section 1111.15 \| Purchase of services or products. Effective: January 1, 2007 Latest Legislation: House Bill 416 - 126th General Assembly PDF: Download Authenticated PDF (A) A trust company acting in any fiduciary capacity, including, but not limited to, the capacities described in section 1111.11 of the Revised Code, may purchase any service or product, including, but not limited to, insurance or securities underwritten or otherwise distributed by the trust company or by an affiliate, through or directly from the trust company or an affiliate or from a syndicate or selling group that includes the trust company or an affiliate, provided that the purchase is otherwise prudent under the Ohio Uniform Prudent Investor Act and the compensation for the service or product is reasonable and is not prohibited by the instrument governing the fiduciary relationship. The compensation for the service or product may be in addition to the compensation that the trust company is otherwise entitled to receive from the fiduciary account. (B) A trust company shall disclose at least annually any purchase authorized by this section that was made by the trust company during that reporting period. The disclosure shall be given, in writing or electronically, to all persons entitled to receive statements of account activity, and shall include any capacities in which the trust company or an affiliate acts for the issuer of the securities or the provider of the products or services and the fact that the trust company or an affiliate may have an interest in the products or services. (C) This section shall apply to the purchase of securities made at the time of the initial offering of the securities or at any time thereafter.
Section 1111.16 \| Fiduciary capacity for holding money and property. Effective: January 1, 1997 Latest Legislation: House Bill 538 - 121st General Assembly PDF: Download Authenticated PDF (A) A trust company may receive and hold money and other property in a fiduciary capacity generally in trust as trustee unless the instrument or other authority appointing the trust company as trustee directs that the money and property be held, in whole or in part, separately from other money and property held in a fiduciary capacity. (B) Moneys held in a fiduciary capacity by a trust company may, pending distribution, payment of current obligations, or investment, be treated as a deposit in the trust company. Such moneys may also be deposited in an affiliate of the trust company that is authorized to receive deposits, or in any other institution that is authorized to receive deposits. In the event the trust company, affiliate, or other institution in which such moneys are deposited becomes insolvent, closes, or is suspended, the claims for such moneys shall be preferred. The assets of the trust company, affiliate, or other institution in which such moneys are deposited shall be impressed with a trust for the payment of such claims.
Section 1111.17 \| Will, trust instrument or other authority governs. Effective: January 1, 1997 Latest Legislation: House Bill 538 - 121st General Assembly PDF: Download Authenticated PDF Any will, trust instrument, or other authority under which a trust company acts shall govern the trust company in receiving, holding, investing, and distributing money and other property the trust company holds in a fiduciary capacity.
Section 1111.18 \| Separating fiduciary assets and records. Effective: January 1, 1997 Latest Legislation: House Bill 538 - 121st General Assembly PDF: Download Authenticated PDF (A) A trust company shall segregate all assets held in any fiduciary capacity from the trust company's own assets, and shall keep its fiduciary records separate and distinct from the trust company's other records. (B) A trust company shall not use funds received in any fiduciary capacity in conducting the trust company's business. However, if the trust company is a bank, savings and loan association, or savings bank authorized to engage in business in addition to trust business, the trust company may invest the funds received in a fiduciary capacity in a deposit account or instrument of the trust company as specifically permitted by section 1111.13 of the Revised Code. No person shall access any property held by a trust company in trust to satisfy a liability of the trust company. (C) A trust company shall not accept or, if the trust company is a bank, savings and loan association, or savings bank authorized to engage in business in addition to trust business, shall not in its trust department accept, deposits of current funds subject to check or the deposit of checks, drafts, bills of exchange, or other items for collection or exchange purposes.
Section 1111.21 \| Stated capital security for faithful discharge of duties. Effective: January 1, 1997 Latest Legislation: House Bill 538 - 121st General Assembly PDF: Download Authenticated PDF (A) The stated capital of a trust company, with the liabilities of the shareholders existing under the terms of the shares, shall be held as security for the faithful discharge of the duties undertaken by the trust company in respect to any trust or in any fiduciary capacity. (B)(1) Except as provided in division (B)(2) of this section, no bond or other security shall be required from any trust company with respect to any trust or when the trust company is appointed executor, administrator, guardian, trustee, receiver, assignee, or safekeeping agent. (2) A court or officer appointing a trust company executor, administrator, guardian, trustee, receiver, assignee, or safekeeping agent may, upon proper application, require the trust company to give security for the faithful performance of its duties. The court or officer may revoke the appointment if the trust company fails to give the security required.
Section 1111.22 \| Records kept separate. Effective: January 1, 1997 Latest Legislation: House Bill 538 - 121st General Assembly PDF: Download Authenticated PDF (A) A trust company shall keep separate and complete records for each fiduciary account or relationship, including a record of any securities constituting assets of each particular estate, trust, or account. (B) A trust company may place securities it holds in any fiduciary capacity with a qualified custodian of securities. A qualified custodian of securities that has custody of securities held by a trust company in a fiduciary capacity may place those securities with another qualified custodian of securities. (C) A trust company may register and hold securities it holds in any fiduciary capacity in its own name, in the name of a nominee, or, if appropriate to the securities, in bearer form. A custodian of securities that has custody of securities held by a trust company in a fiduciary capacity may hold or place those securities in the name of the trust company, the custodian's own name, the name of either of their nominees, or, if appropriate to the securities, in bearer form. (D) A trust company, and a custodian of securities that has custody of securities held by a trust company in any fiduciary capacity, may hold securities it holds in any fiduciary capacity, including those held in bearer form, in bulk, whether or not the securities are certificated, without certification of ownership attached to the securities. (E) A trust company is liable to an estate, trust, or other fiduciary account for any loss resulting from any acts or omissions of the trust company, a nominee, or a custodian of securities relating to securities the trust company holds in any fiduciary capacity. (F)(1) A trust company that serves as a cofiduciary may, with the consent of the other cofiduciaries, do any of the following: (a) Place securities it holds in any fiduciary capacity with a custodian of securities, as provided in division (B) of this section; (b) Register and hold securities it holds in any fiduciary capacity in its own name, in the name of a nominee, or in bearer form, as provided in division (C) of this section; (c) Hold securities it holds in any fiduciary capacity in bulk, as provided in division (D) of this section. (2) Any person that serves as a cofiduciary with a trust company for any property in this state consisting of securities may consent to the trust company taking any of the actions authorized by division (F)(1) of this section.
Section 1111.23 \| Requirements for oaths, affidavits and signatures. Effective: January 1, 1997 Latest Legislation: House Bill 538 - 121st General Assembly PDF: Download Authenticated PDF (A)(1) Whenever an executor, administrator, guardian, or conservator of estates, assignee, receiver, depositary, safekeeping agent, or trustee is required to take and subscribe an oath or to make an affidavit, a trust company acting in that capacity may satisfy the requirement through the oath or affidavit of any authorized officer. (2) A trust company that takes and subscribes an oath or makes an affidavit is liable for its failure to perform any of the duties required by law to be performed by an individual acting in like capacity, and is subject to the same penalties for the failure as would be applicable to an individual. (B) In proceedings in any probate court or court of record that are connected with any authority exercised under Chapters 1101. to 1127. of the Revised Code, all accounts, returns, and other papers may be signed and sworn to on behalf of a trust company by any authorized officer of the trust company.
Section 1111.26 \| Regulation by superintendent and division of financial institutions. Effective: January 1, 1997 Latest Legislation: House Bill 538 - 121st General Assembly PDF: Download Authenticated PDF (A) Any trust company is subject to all powers of, and remedies and sanctions available to, the superintendent of financial institutions and the division of financial institutions under Chapters 1101. to 1127. of the Revised Code, in addition to the specific powers, remedies, and sanctions provided for in this chapter. (B)(1) With regard to a trust company that is not a bank doing business under authority granted by the superintendent, "regulated person," as used in division (B) of this section, means a director, officer, employee, or controlling shareholder of or agent for the trust company or a person who participates in the management of the trust company, whether or not the person is assigned to an office of the trust company in this state or specifically to the trust company's trust business in this state. (2) An order to cease and desist issued under section 1121.32 of the Revised Code, a removal or prohibition order issued under section 1121.33 of the Revised Code, or a suspension order issued under section 1121.34 of the Revised Code, which order is issued against a regulated person who is a regulated person because of the person's relationship with a trust company doing trust business in this state that is not a bank doing business under authority granted by the superintendent, does not affect the relationship between the regulated person and the trust company except as it relates to the conduct of the trust company's trust business in this state.
Section 1111.27 \| Reporting to superintendent. Effective: January 1, 1997 Latest Legislation: House Bill 538 - 121st General Assembly PDF: Download Authenticated PDF Each trust company licensed under this chapter shall file with the superintendent of financial institutions any report the superintendent may require, in the form and manner and containing the information prescribed by the superintendent.
Section 1111.28 \| Court order for investigation of trust. Effective: January 1, 1997 Latest Legislation: House Bill 538 - 121st General Assembly PDF: Download Authenticated PDF (A) Any judge of a court by order of which a trust company is acting in a fiduciary capacity may, upon the judge's own motion or upon the written application of any party interested in the trust estate, appoint suitable persons to investigate the affairs and management of the trust company concerning the trust. The persons who conduct the investigation shall make a sworn report to the court of the investigation. The expense of the investigation shall be taxed as costs, either against the party requesting it or against the assets of the trust, as the court decrees. The court may examine any officers of the trust company, under oath or affirmation, as to the trust, or as to the affairs and management of the trust company, while the court is considering its appointment. The examination and answers of an authorized officer of a trust company under oath shall be received as the examination and answers of the trust company. The court may compel any of the officers of the trust company to attend these examinations and to answer questions relating to the proceedings. (B) For any cause applicable to natural persons serving in the same capacity, the court may order that the trust company promptly settle the trust.
Section 1111.31 \| Ceasing trust business. Effective: January 1, 1997 Latest Legislation: House Bill 538 - 121st General Assembly PDF: Download Authenticated PDF (A) A trust company licensed under this chapter may cease doing trust business and voluntarily surrender its license to solicit or engage in trust business in this state, and as a consequence be relieved of the necessity to comply with the requirements of this chapter, only with the consent of the superintendent of financial institutions. (B) A trust company proposing to cease doing trust business in this state shall submit both of the following to the superintendent: (1) A certified copy of the resolution of the trust company's board of directors reflecting the board's decision the trust company should cease doing trust business in this state and adopting a plan for winding up its trust business in this state; (2) The trust company's plan for winding up its trust business in this state. (C) The superintendent may approve or deny the trust company's plan for winding up its trust business in this state based on the superintendent's evaluation of whether the plan provides adequate protection for those persons and interests the trust company serves as a fiduciary. The superintendent's approval may be subject to any condition the superintendent determines appropriate under the circumstances. (D) During the implementation of a trust company's plan for winding up its trust business in this state, the superintendent shall retain the authority to supervise the trust company and may conduct any examination relating to either the trust company or the plan the superintendent considers necessary or appropriate. (E) If the superintendent has reason to conclude that the trust company is not safely or expeditiously implementing the approved plan for winding up the trust company's trust business in this state, the superintendent may do either of the following: (1) Begin revocation proceedings under section 1111.32 of the Revised Code; (2) Take possession of the trust company's trust business in this state in the same manner, with the same effect, and subject to the same rights accorded to the trust company under section 1111.32 of the Revised Code. (F) The superintendent shall cancel the trust company's license to do trust business in this state if the superintendent has approved the trust company's plan for winding up its trust business in this state and all of the following conditions that apply to the trust company have been met: (1) The trust company has completed its plan for winding up its trust business in this state consistent with any conditions imposed by the superintendent in approving the plan. (2) The trust company has been relieved in accordance with the law of all duties as trustee, executor, administrator, registrar of stocks and bonds, or any other fiduciary under court, private, or other appointment the trust company had accepted. (3) If the trust company has its principal place of business in this state, the trust company has, in accordance with the law, wound up its trust business in each of the other jurisdictions in which the trust company solicited appointment or served as a fiduciary or engaged in trust business. (4) If the trust company has its principal place of business in this state and is authorized to engage in no other business than trust business, the trust company is being liquidated in accordance with Chapter 1125. of the Revised Code. (G) Upon the superintendent's canceling the trust company's license to do trust business in this state, the company shall no longer, without obtaining a license from the superintendent, do either of the following: (1) Solicit or engage in trust business in this state; (2) If the trust company has its principal place of business in this state, solicit or engage in trust business in any jurisdiction.
Section 1111.32 \| Revoking or suspending license. Effective: January 1, 1997 Latest Legislation: House Bill 538 - 121st General Assembly PDF: Download Authenticated PDF (A) If the superintendent of financial institutions determines, after notice in accordance with section 1121.37 of the Revised Code and opportunity for hearing in accordance with section 1121.38 of the Revised Code, that any of the following factors is true, the superintendent may revoke a trust company's license to do trust business in this state: (1) The existence of the trust company, or its authority to transact business, has been terminated or suspended under the laws of the state or country in which the trust company is incorporated. (2) The trust company's authority to transact trust business has been terminated or suspended under the laws of the state or country in which the trust company is incorporated, or its license to engage in trust business has been terminated or suspended under the laws of any other jurisdiction in which the trust company had been licensed to engage in trust business. (3) A receiver, liquidator, or conservator has been appointed for the trust company under the laws of the state or country in which the trust company is incorporated or for its business in any other jurisdiction in which the trust company transacts business. (4) The trust company is violating or has violated, or the superintendent has reasonable cause to believe is about to violate, any of the following: (a) A law or rule; (b) A condition imposed by the superintendent in writing in connection with approving an application or notice or granting any other request of the trust company; (c) A written agreement the trust company entered into with the superintendent; (d) A cease and desist order issued by the superintendent under section 1121.32 of the Revised Code. (5) The trust company is engaging or has engaged, or the superintendent has reasonable cause to believe is about to engage, in any unsafe or unsound practice. (6) The trust company has ceased to pay its debts in the ordinary course of business, is incapable of paying its debts as they mature, has liabilities in excess of its assets, or is subject to or has applied for an adjudication in bankruptcy, reorganization, or other relief under any bankruptcy, reorganization, insolvency, or moratorium law. (7) The trust company has ceased or failed to conduct trust business in this state. (8) The trust company has failed to pay any fees, charges, forfeitures, or penalties assessed under Chapters 1101. to 1127. of the Revised Code. (B)(1) If the superintendent has reasonable cause to believe any of the factors in division (A) of this section is true, and the superintendent determines it is necessary to protect the persons and interests in this state that the trust company serves as a fiduciary or the property in this state that the trust company holds title to or an interest in as a fiduciary, the superintendent may immediately suspend the trust company's license to do trust business in this state. (2) Within ten days after the order suspending a trust company's license to do trust business in this state is served upon it, the trust company may apply to the court of common pleas of any county in this state in which the trust company is doing business, or the court of common pleas of Franklin county, for an injunction setting aside, limiting, or suspending enforcement of the suspension order pending an opportunity for hearing on whether the trust company's license to do trust business in this state should be revoked, and the court has jurisdiction to issue the injunction.
Section 1111.33 \| Liquidating assets. Effective: January 1, 1997 Latest Legislation: House Bill 538 - 121st General Assembly PDF: Download Authenticated PDF (A) If the superintendent of financial institutions revokes a trust company's license to do trust business in this state pursuant to division (A) of section 1111.32 of the Revised Code, the superintendent may take possession of the trust company's trust business in this state and may appoint a receiver for the liquidation of the trust business in this state. If the trust company has its principal place of business in this state, the superintendent may take possession of, and appoint a receiver for the liquidation of, its entire trust business wherever it is conducted. (B) The superintendent's taking possession of, and appointing a receiver for the liquidation of, a trust company's trust business in this state under division (A) of this section and the liquidation of the trust company's trust business in this state shall be conducted in accordance with the procedures and subject to the rights, powers, duties, requirements, and limitations provided in Chapter 1125. of the Revised Code for taking possession of the business and property and liquidation of a bank, except for the following: (1) After payment of the expenses of the liquidation and claims against the trust company arising from its doing trust business in this state in accordance with divisions (A) and (B) of section 1125.25 of the Revised Code, the receiver shall distribute any remaining funds from the liquidation of the trust company's trust business in this state to the receiver for liquidation of the trust company's trust business in another state of the United States or for conducting a liquidation of all or part of the trust company's trust business under laws of the United States, or equitably among the receivers if the trust company's trust business is being liquidated under the laws of more than one other state or the United States, for payment of the expenses of liquidation and claims against the trust company's trust business. If there is no liquidation of the trust company's trust business under way in any other state or under laws of the United States, the receiver shall, after satisfying the requirements of divisions (A) and (B) of section 1125.25 of the Revised Code, pay any remaining funds from the liquidation of the trust company's trust business in this state to the trust company. (2) When the receiver has completed the liquidation of the trust company's trust business in this state, the receiver shall, with notice to the superintendent, petition the court for an order declaring the trust company's trust business in this state is properly wound up in the manner provided in section 1125.30 of the Revised Code. Upon the filing of the petition, the court shall proceed as provided in section 1125.30 of the Revised Code. An order issued by the court pursuant to a petition filed under division (B)(2) of this section shall comply with section 1125.30 of the Revised Code. However, the order shall only declare the trust company's trust business in this state has been properly wound up and shall not declare the trust company is dissolved. The court may make whatever additional orders and grant whatever additional relief the court determines is proper upon the evidence submitted. Once the order is issued declaring the trust company's trust business in this state is properly wound up, both of the following shall occur: (a) The trust company shall, except for any further winding up, cease soliciting or engaging in trust business in this state and, if the trust company has its principal place of business in this state, cease soliciting or engaging in trust business in any jurisdiction. (b) The receiver shall promptly file, with both the secretary of state and the superintendent, a copy of the order, certified by the clerk of the court. (C) If the trust company is a bank doing business under authority granted by the superintendent, all of the following apply: (1) If the trust company is being liquidated under Chapter 1125. of the Revised Code, the trust company's trust business shall also be liquidated even if there would not be independent grounds for liquidation of the trust business under this section. (2) If the trust company's trust business is being liquidated under this section and the trust company as a whole is being liquidated under Chapter 1125. of the Revised Code, the liquidations shall be merged. (3) If the trust company is not authorized to engage in any business other than trust business, its liquidation shall be of the company as a whole, conducted under Chapter 1125. of the Revised Code and completed by the dissolution of the trust company.