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Tentative Regulation M I S S A L PFflSfiVE PCAPD V'ashington, D r C. W1 Regulations governing conditions under which National Banks may ba granted permission to act as. trustee, etc,, under Section 11, Subsection K, of the Federal Reserve Act. I. Application of member banks to act as trusteev.executor, adminietre tor, transfer agent, or registrar qf stocks and bends under Section ll (K$ of the Federal Reserve Act. 1. Any member bank desiring to exercise any or all of the privi leges authorized by this section .'.hall make application to ths Federal Reserve Board on a form approved by said Board. This application 3hall be forwarded by the applying bank to the chairman of °the board of directors of the Federal reserve bank of its d i s t r i c t a n d shall thereupon be trans* mitted.te the Federal Reserve Board with the recommendation of the direc tors of said Federal reserve bank. 2. There shall be attached to each application the following ex hibits. (a) A statement in detail of the character the privileges which the applying bank desires if it desires to act as trustee, the statement ically the nature cf such trusteeships and the assumed. and extent of to undertake, and shall show specif obligations to be (b) A copy cf the laws of the stats in which such bank is located, which relate to the exercise of these powers by c o r p o r ations. (c) A copy cf the laws relating tc the appointment*, .of, and the bonds and reports .required of executors and fcdir.Wistrators, if the applying bank desires to act in such capacities. (a) A copy of the laws, if any, relating to corporations acting as- transfer agents and registrars cf stocks and bonds, if the applying bank desiros to exercise this privilege. • 183 Separata Departments. Each National bajik permitted to apt und^er thi» s t a t i o n , shall establish a separata trust xtepaaptment and place it ynder the managap&nt of a trust officer who shall p-epf-orm his duties under the supervision of a committee to be known as a Trust O p m m i t j e e f composed' of not less than three members of the board of directors of the bank., III. Provision for keening Trust F u n d s . The f b n d s , securities and investments held in trust shall be held separate and distinct from the general -funds and securities of the bank, and separate and distinct from each other, A separate vau2.t, safe or com* partment shall be provided by each bank acting under this section, in which the funds and securities belonging to ice trust department shall be kept, ahd the ledgers and other book* rkept for the trust, department shall be en** i tirely separate anti apart from the other booka/ard records of the bank. The trust bfficer Shall not be permitted to deposit any funds of the trust department with his own bank, but may be permitted by resolution of the board of directors to open such accounts as may be necessary in the name of the trust department in some other bank or banks. IV; Trust funds may be invested in any manner provided in the inetru* ment creating the trust competent Investment of Trust F u n d s . fund or as ordered or authorized by any court of jurisdiction or as specifically authorized by the laws of the ✓ state in which said National bank is situated. V; Trustee under Mortgage or Deed of T r u s t . In any case where the bank is named as trustee ih'any mortgage or deed of trust it shall require a c^er^ified copy of the original mortgage or deed of trust to be. filed with it i/hd shall at all times keep an aceu~ 184 rate account of any bonds outstanding which .are secured by such mortgage or deed of trust, and v/hioh have been certified to for identification by the trustee. Such records shall bo so kept &3 to enable the bank to fur nish the Federal Reserve Beard or the Federal Reserve Bank from time to time with any information called for relating to the powers vested in the trustee and the duties imposed by the mortgage or deeds of trust upon such trustee, and to any other matters relating to the exercise of sueh powers and the performance of such duties. VI. Transfer Agent and Registrar. Any bank-granted permission to act as Transfer Agent or Regis trar, of stocks and bonds shall have the privilege of acting in either capacity, but shall not act in both capacities with respect to the same issue of stocks or bonds. Before acting in either capacity the bank shall require the corporation issuing the stock or.bond to file with it a state ment signed by the president or vice president of the corporation, with the seal of the corporation affixed, arid attested by the secretary, setting forth fully and accurately the basis or financial plan upon which all i stocks and bonds are to be have been issued, also a list giving the number of all stocks or bonds outstanding with the names of registered holders and dates of issue. Such statement or financial plan shall be in form and shall contain^ sufficient information in detail to enable the bank acting as transfer agent or registrar to furnish the Federal Reserve Board, or any stockholder or bondholder of the corporation, or any other person en titled thereto, with any information as to the basis of issue of such stock or bonds, the authority for such issue, and the amount outstanding at any time. vgt. Sgjgtt$s«, Whenever tho^ Comptroller of the Currency calls for report.9 of condition of the bank, such report 3hall be accompanied by a full statement of the condition of the trusty department 4 Upon' request, reports of the'1 trust department -shall also be furnished to the Federal Reserve Board and to the Federal reserve bank of the district in which said bank is located* VIII. Examination. Examiners appointed by the Comptroller of the Currency cr design nated by the Federal Reserve Board, shall make thorough and complete audits of the cash, securities, accounts and investments of the trust department of every bank, at the same time that examination is made of the banking department. IX. Security on Bond. Any National bank acting as trustee, executor, administrator, transfer agent or registrar of stocks and bonds, shall give such bond as may be required by the -laws of the state in which said bank is located, or as may be required by the court appointing it. X. . Conformity with State^Laws. Nothing in these regulations shall be construed to give to a national bank doing business as trustee, executor, administrator, transfer agent, or registrar of stocks and bonds -under Section 11 (K) of the Federal Reserve'Act, any rights or privileges in contravention of the laws of the state in which the bank is located* XI. Changer, in Rules. These rules and regulations are subject to change at any time by - the Federal Reserve Board. 4
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