Minnesota Legislature
SF 908
3rd Engrossment - 80th Legislature (1997 - 1998) Posted on 12/15/2009 12:00am
KEY: stricken = removed, old language.
underscored = added, new language.
1.1 A bill for an act 1.2 relating to financial institutions; trust companies; 1.3 providing for the organization, powers, and duties of 1.4 trust companies; providing fiduciary provisions for 1.5 trust companies and banks exercising trust powers; 1.6 regulating interstate trust offices; regulating 1.7 filings in connection with securities; making 1.8 conforming changes; amending Minnesota Statutes 1996, 1.9 sections 48.01, subdivision 1; 48.36, subdivision 1; 1.10 48.37; 48.39; 48.41; 48.42; 48.43; 48.44; 48.45; 1.11 48.46; 48.47; 50.085, subdivision 14; 303.25, 1.12 subdivision 3; 525.551, subdivision 6; and 525.56, 1.13 subdivision 4; Minnesota Statutes 1997 Supplement, 1.14 sections 16A.6701, subdivision 1; 48.01, subdivision 1.15 2; and 80A.28, subdivision 1; proposing coding for new 1.16 law as Minnesota Statutes, chapter 48A; repealing 1.17 Minnesota Statutes 1996, sections 48.38; 48.475; 1.18 48.65; 48.66; 48.67; 48.68; 48.69; 48.70; 48.71; 1.19 48.72; 48.73; 48.75; 48.76; 48.77; 48.78; 48.79; 1.20 48.80; 48.81; 48.82; 48.83; 48.84; 48.841; 48.845; 1.21 48.846; 48.85; and 48.86; and Minnesota Statutes 1997 1.22 Supplement, section 48.476. 1.23 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 1.24 Section 1. Minnesota Statutes 1997 Supplement, section 1.25 16A.6701, subdivision 1, is amended to read: 1.26 Subdivision 1. [STATE LICENSE AND SERVICE FEES.] For 1.27 purposes of section 16A.67, subdivision 3, and this section, the 1.28 term "state license and service fees" means, and refers to, all 1.29 license fees, service fees, and charges imposed by law and 1.30 collected by any state officer, agency, or employee, which are 1.31 listed below or which are defined as departmental earnings under 1.32 section 16A.1285, subdivision 1, and the use of which is not 1.33 otherwise restricted by law, and which are not required to be 1.34 credited or transferred to a fund other than the general fund: 2.1 Minnesota Statutes 1994, sections 3.9221; 5.12; 5.14; 5.16; 2.2 5A.04; 6.58; 13.03, subdivision 10; 16A.155; 16A.48; 16A.54; 2.3 16A.72; 16B.59; 16B.70; 17A.04; 18.51, subdivision 2; 18.53; 2.4 18.54; 18C.551; 19.58; 19.64; 27.041, subdivision 2, clauses (d) 2.5 and (e); 27.07, subdivision 5; 28A.08; 32.071; 32.075; 32.392; 2.6 35.71; 35.824; 35.95; 41C.12; 45.027, subdivisions 3 and 6; 2.7 46.041, subdivision 1; 46.131, subdivisions 2, 7, 8, 9, and 10; 2.8 47.101, subdivision 2; 47.54, subdivisions 1 and 4; 47.62, 2.9 subdivision 4; 47.65;48.475, subdivision 1;48.61, subdivision 2.10 7; 48.93; 48A.16; 49.36, subdivision 1; 52.01; 52.203; 53.03, 2.11 subdivisions 1, 5, and 6; 53.09, subdivision 1; 53A.03; 53A.05, 2.12 subdivision 1; 53A.081, subdivision 3; 54.294, subdivision 1; 2.13 55.04, subdivision 2; 55.095; 56.02; 56.04; 56.10; 59A.03, 2.14 subdivision 2; 59A.06, subdivision 3; 60A.14, subdivisions 1 and 2.15 2; 60A.23, subdivision 8; 60K.19, subdivision 5; 65B.48, 2.16 subdivision 3; 70A.14, subdivision 4; 72B.04, subdivision 10; 2.17 79.251, subdivision 5; 80A.28, subdivisions 1, 2, 3, 4, 5, 6, 7, 2.18 7a, 8, and 9; 80C.04, subdivision 1; 80C.07; 80C.08, subdivision 2.19 1; 80C.16, subdivisions 2 and 3; 80C.18, subdivision 2; 82.20, 2.20 subdivision 8 and 9; 82A.04, subdivision 1; 82A.08, subdivision 2.21 2; 82A.16, subdivisions 2 and 6; 82B.09, subdivision 1; 83.23, 2.22 subdivisions 2, 3, and 4; 83.25, subdivisions 1 and 2; 83.26, 2.23 subdivision 2; 83.30, subdivision 2; 83.31, subdivision 2; 2.24 83.38, subdivision 2; 85.052; 85.053; 85.055; 88.79, subdivision 2.25 2; 89.035; 89.21; 115.073; 115.77, subdivisions 1 and 2; 116.41, 2.26 subdivision 2; 116C.69; 116C.712; 116J.9673; 125.08; 136C.04, 2.27 subdivision 9; 155A.045; 155A.16; 168.27, subdivision 11; 2.28 168.33, subdivisions 3 and 7; 168.54; 168.67; 168.705; 168A.152; 2.29 168A.29; 169.345; 171.06, subdivision 2a; 171.29, subdivision 2; 2.30 176.102; 176.1351; 176.181, subdivision 2a; 177.30; 181A.12; 2.31 183.545; 183.57; 184.28; 184.29; 184A.09; 201.091, subdivision 2.32 5; 204B.11; 207A.02; 214.06; 216C.261; 221.0355; 239.101; 2.33 240.06; 240.07; 240.08; 240.09; 240.10; 246.51; 270.69, 2.34 subdivision 2; 270A.07; 272.484; 296.06; 296.12; 296.17; 2.35 297F.03; 297.33; 299C.46; 299C.62; 299K.09; 299K.095; 299L.07; 2.36 299M.04; 300.49; 318.02; 323.44, subdivision 3; 325D.415; 3.1 326.22; 326.3331; 326.47; 326.50; 326.92, subdivisions 1 and 3; 3.2 327.33; 331A.02; 332.15, subdivisions 2 and 3; 332.17; 332.22, 3.3 subdivision 1; 332.33, subdivisions 3 and 4; 332.54, subdivision 3.4 7; 333.055; 333.20; 333.23; 336.9-413; 336A.04; 336A.05; 3.5 336A.09; 345.35; 345.43, subdivision 2a; 345.44; 345.55, 3.6 subdivision 3; 347.33; 349.151; 349.161; 349.162; 349.163; 3.7 349.164; 349.165; 349.166; 349.167; 357.08; 359.01, subdivision 3.8 3; 360.018; 360.63; 386.68; and 414.01, subdivision 11; 3.9 Minnesota Statutes 1994, chapters 154; 216B; 237; 302A; 303; 3.10 308A; 317A; 322A; and 322B; Laws 1990, chapter 593; Laws 1993, 3.11 chapter 254, section 7; and Laws 1994, chapter 573, section 4; 3.12 Minnesota Rules, parts 1800.0500; 1950.1070; 2100.9300; 3.13 7515.0210; and 9545.2000 to 9545.2040. 3.14 Sec. 2. Minnesota Statutes 1996, section 48.01, 3.15 subdivision 1, is amended to read: 3.16 Subdivision 1. [WORDS, TERMS, AND PHRASES.] Unless the 3.17 language or context clearly indicates that a different meaning 3.18 is intended, the term defined in subdivision 2, for the purposes 3.19 of sections48.38,48.56 to 48.59,and 48.8448A.07, and 48A.08, 3.20 has that meaning; and the term defined in subdivision 3, for the 3.21 purposes of this chapter, has that meaning. 3.22 Sec. 3. Minnesota Statutes 1997 Supplement, section 48.01, 3.23 subdivision 2, is amended to read: 3.24 Subd. 2. [BANKING INSTITUTION.] The term "banking 3.25 institution" means any bank, trust company, bank and trust 3.26 company, or savings bank which is now or may hereafter be 3.27 organized under the laws of this state. For purposes of 3.28 sections48.38, 48.8448A.07, 48A.08, and 501B.151, subdivision 3.29 11, and to the extent permitted by federal law, "banking 3.30 institution" includes any national banking association or 3.31 affiliate exercising trust powers in this state. 3.32 Sec. 4. Minnesota Statutes 1996, section 48.36, 3.33 subdivision 1, is amended to read: 3.34 Subdivision 1. Any state bank having a capital and surplus 3.35 of not less than $500,000 may exercise the powers and privileges 3.36 conferred by sections48.36 to 48.4348A.07 and 48A.08, in 4.1 addition to all other powers granted by law, upon complying with 4.2 the conditions and requirements of those sections, and receiving 4.3 the approval of the commissioner of commerce, who may grant or 4.4 reject, in the commissioner's judgment, the application of any 4.5 bank to acquire trust authority, and in doing so shall take into 4.6 consideration the following factors: 4.7 (1) The needs of the community for trust service of the 4.8 kind applied for and the probable volume of such trust business 4.9 available to the bank; 4.10 (2) The general condition of the bank, particularly the 4.11 adequacy of its net capital and surplus funds in relation to the 4.12 character and condition of its assets and to its deposit 4.13 liabilities and other corporate responsibilities, including the 4.14 proposed exercise of trust powers; 4.15 (3) The general character and ability of the management of 4.16 the bank; 4.17 (4) The nature of the supervision to be given to the 4.18 proposed trust activities, including the qualifications and 4.19 experience of the members of the proposed trust investment 4.20 committee; 4.21 (5) The qualifications, experience, and character of the 4.22 proposed executive officer or officers of the trust department; 4.23 (6) Whether the bank has available competent legal counsel 4.24 to advise and pass upon trust matters whenever necessary; and 4.25 (7) Any other facts and circumstances that seem proper. 4.26 Sec. 5. Minnesota Statutes 1996, section 48.37, is amended 4.27 to read: 4.28 48.37 [CERTIFICATES FROM COMMISSIONER.] 4.29 In order to exercise the powers herein conferred, any such 4.30 bank shall invest and keep invested in one or more of the first, 4.31 second, third, fourth, seventh, and eighth classes of authorized 4.32 securities, at least 25 percent of its capital, which securities 4.33 in the amounts above provided shall be duly assigned, 4.34 transferred to, and deposited with the commissioner provided, 4.35 however, that no bank and trust shall be required to deposit 4.36 securities in excess of $1,000,000, and shall be maintained 5.1 unimpaired as a guaranty fund for the integrity of its trusts 5.2 and for the faithful discharge of its duties, in connection 5.3 therewith, with the right to the bank to collect the income 5.4 thereof and to substitute other like authorized securities of 5.5 equal amount and value. The commissioner shall carefully 5.6 examine the securities offered for deposit and, if they comply 5.7 with all the provisions of law applicable thereto, and, if the 5.8 bank making such deposit shall possess the qualifications stated 5.9 in section 48.36, shall issue to the bank a certificate stating 5.10 that it is qualified to exercise the powers herein conferred, 5.11 and, upon the issuance of this certificate and while the same 5.12 remains in force, the bank may exercise the powers and 5.13 privileges conferred by sections48.36 to 48.4348A.07 and 5.14 48A.08. 5.15 In case of any increase in the capital of any bank which 5.16 has qualified hereunder, this certificate shall be and become 5.17 revoked and the bank shall not thereafter exercise the powers 5.18 herein conferred until it shall have deposited the required 5.19 proportion of its capital in authorized securities and received 5.20 a new certificate that it is qualified hereunder. 5.21 Sec. 6. Minnesota Statutes 1996, section 48.39, is amended 5.22 to read: 5.23 48.39 [TRUST ACCOUNTS RECORDED.] 5.24 Besides its general books of account, it shall keep 5.25 separate books of account for all fiduciary accounts. All funds 5.26 and property held by it in a fiduciary capacity shall at all 5.27 times be kept separate from its own funds and property, and all 5.28 fiduciary funds deposited or held as fiduciary by the bank 5.29 awaiting investment shall be carried in a separate account, and 5.30 shall not be used by the bank in the conduct of its business, 5.31 unless the bank, under authorization by its board of directors, 5.32 first delivers to the commissioner of commerce, as collateral 5.33 security: (1) bonds, notes, bills, certificates of indebtedness 5.34 or other direct obligations of the United States or its 5.35 instrumentalities, or obligations fully guaranteed by the United 5.36 States as to principal and interest; or (2) other readily 6.1 marketable securities of the classes in which said trust 6.2 companies or state banks exercising trust powers are authorized 6.3 or permitted to invest trust funds under the laws of this 6.4 state. The securities so deposited as collateral shall be owned 6.5 by the bank and shall at all times be at least equal in market 6.6 value to the amount of the trust funds so used in the conduct of 6.7 the bank's business, and all deposits made by it of such funds 6.8 in any other banking institutions shall be deposited as 6.9 fiduciary funds, to its credit as fiduciary, and not otherwise. 6.10 Every security or property in which the funds held by it as 6.11 trustee, executor, administrator, guardian, receiver, or 6.12 assignee, or in any other fiduciary capacity are invested, shall 6.13 at once upon receipt thereof be immediately entered in the 6.14 proper books as belonging to the particular fiduciary account 6.15 whose funds have been invested therein. Any change in such 6.16 investment shall be fully specified in and under the account of 6.17 the particular fiduciary account to which it belongs so that all 6.18 fiduciary funds and property can be readily identified at any 6.19 time by any person. It shall be unlawful for any bank to lend 6.20 any officer, director or employee any funds held as fiduciary 6.21 under the powers conferred bysections 48.36 to 48.43section 6.22 48.37. Any officer, director or employee to whom such a loan is 6.23 made shall be guilty of theft of the amount of such loan from 6.24 the time of the making thereof. Any state bank, when acting in 6.25 a fiduciary capacity, either alone or jointly with an individual 6.26 or individuals, may, with the consent of such individual 6.27 fiduciary or fiduciaries, who are hereby authorized to give such 6.28 consent, cause any stocks, securities, or other property now 6.29 held or hereafter acquired in such capacity to be registered and 6.30 held in the name of a nominee or nominees of such state bank 6.31 without mention of the fiduciary relationship. Any such state 6.32 bank shall be liable for any loss occasioned by the acts of any 6.33 of its nominees with respect to such stocks, securities or other 6.34 property so registered. 6.35 Sec. 7. Minnesota Statutes 1996, section 48.41, is amended 6.36 to read: 7.1 48.41 [CORPORATE NAME.] 7.2 Any such bank which has qualified and obtained a 7.3 certificate, as provided insections 48.36 to 48.43section 7.4 48.37, may use in its corporate name or title, in addition to 7.5 the word "bank" or other words now permitted by law, the words 7.6 "trust" or "trust company," and may display and make use of 7.7 signs, symbols, tokens, letterheads, cards, circulars and 7.8 advertisements stating or indicating that it is authorized to 7.9 transact the business authorized by said sections, and any such 7.10 bank using the words "trust" or "trust company" is not required 7.11 to use the word "state" in its corporate name. 7.12 Sec. 8. Minnesota Statutes 1996, section 48.42, is amended 7.13 to read: 7.14 48.42 [BANK MAY BE DESIGNATED AS SAVINGS BANK.] 7.15 Any state bank which has qualified undersections 48.36 to7.1648.43section 48.37 and obtained the certificate therein 7.17 provided, and which has established and maintains a savings 7.18 department, may use in its name or title, in addition to other 7.19 words permitted by law, the words "savings" or "savings bank." 7.20 Savings deposits received by any such state bank using the words 7.21 "savings" or "savings bank" in its corporate name or title, 7.22 shall be invested only in authorized securities, as defined by 7.23 law, and the bank shall keep in hand at all times, in addition 7.24 to the securities required to be deposited under the provisions 7.25 of section 48.37, such securities as deposits in savings banks 7.26 may be invested in to an amount at least equal to the savings 7.27 deposits, and these securities to the amount of these deposits 7.28 shall be representative of and the fund for and applicable first 7.29 and exclusively to the payment of the savings deposits. 7.30 Deposits received by the bank subject to its right to require 7.31 notice of withdrawal evidenced by pass books, shall be deemed 7.32 savings deposits. 7.33 Sec. 9. Minnesota Statutes 1996, section 48.43, is amended 7.34 to read: 7.35 48.43 [BANKS MAY CEASE OPERATIONS; DUTIES OF COMMISSIONER.] 7.36 Any state bank which has qualified hereunder may at any 8.1 time notify the commissioner, in writing, that it intends to 8.2 cease to operate under the provisions ofsections 48.36 to 48.438.3 section 48.37, and thereupon the certificate issued to it, as 8.4 provided insections 48.36 to 48.43section 48.37, shall be 8.5 canceled and revoked, and the bank shall thereafter exercise no 8.6 power or privilege except those permitted to state banks which 8.7 have not qualified hereunder, and the securities deposited with 8.8 the commissioner, as provided in section 48.37, shall forthwith 8.9 be reassigned and returned to the bank; provided, that no part 8.10 of the deposited securities shall be so returned until the bank 8.11 shall have eliminated from its corporate name the words "trust," 8.12 "trust company," or "savings," nor until it has ceased to hold 8.13 any trust or trust office authorized bysections 48.36 to 48.438.14 section 48.37, nor until all its accounts in any such trust 8.15 shall have been settled and allowed and all property held in 8.16 trust by it delivered to the persons entitled thereto, nor until 8.17 all liabilities incurred by it as trustee, agent, or otherwise, 8.18 under the provisions ofsections 48.36 to 48.43section 48.37, 8.19 and which it could not have incurred unless qualified 8.20 thereunder, shall have been discharged; provided, further, that 8.21 if the amount of all these liabilities, or the maximum limit 8.22 thereof, has been or can be definitely ascertained, the 8.23 commissioner may retain only such part of the deposited 8.24 securities as shall be at least equal to and as shall be in the 8.25 commissioner's opinion sufficient to liquidate the same. If any 8.26 such bank so surrendering its powers hereunder shall have 8.27 heretofore used the word "savings" in its corporate name, the 8.28 provisions of section 48.42, relating to the investment of 8.29 savings deposits and the rights of such depositors, shall remain 8.30 operative as to all savings deposits on hand at the date of 8.31 surrendering such certificate and until the savings deposits 8.32 shall have been paid to the persons entitled thereto. 8.33 Sec. 10. Minnesota Statutes 1996, section 48.44, is 8.34 amended to read: 8.35 48.44 [BANKS MAY ORGANIZE AS TRUST COMPANY.] 8.36 Hereafter state banks which may be organized in the manner 9.1 now provided by law may be organized with the additional 9.2 authority to exercise the fiduciary powers and privileges set 9.3 out insection 48.38sections 48A.07 and 48A.08; provided, that 9.4 the capital and surplus of any such bank shall not be less than 9.5 $500,000. 9.6 Sec. 11. Minnesota Statutes 1996, section 48.45, is 9.7 amended to read: 9.8 48.45 [CORPORATE NAMES.] 9.9Any suchA bank with the additional authority provided for 9.10 in sections 48A.07 and 48A.08 may be organized with a corporate 9.11 name which may include the words "trust" or "trust company," in 9.12 addition to the word "bank" or other words now permitted by law, 9.13 and the word "state" shall not be a required part of the 9.14 corporate name of any such state bank. 9.15 Sec. 12. Minnesota Statutes 1996, section 48.46, is 9.16 amended to read: 9.17 48.46 [AUTHORIZED SECURITIES PURCHASED.] 9.18 No state bank hereafter organized with authority to 9.19 exercise fiduciary powers pursuant to the provisions of sections 9.2048.44 to 48.4648A.07 and 48A.08, the corporate name of which 9.21 contains the words "trust" or "trust company," shall transact 9.22 any banking or trust company business until it shall have 9.23 invested in and assigned, transferred to, and deposited with the 9.24 commissioner the authorized securities described in and required 9.25 by section 48.37, relating to the authorization of existing 9.26 state banks to exercise such fiduciary powers, and until the 9.27 commissioner of commerce has issued the certificate provided by 9.28 section 47.16, and a certificate stating that such bank is 9.29 qualified to exercise the fiduciary powers set forth insection9.3048.38sections 48A.07 and 48A.08. 9.31 Sec. 13. Minnesota Statutes 1996, section 48.47, is 9.32 amended to read: 9.33 48.47 [BANKING AND TRUST COMPANY BUSINESS.] 9.34 After the application of the corporation shall have been 9.35 favorably acted on by the department in compliance with sections 9.36 46.041 to 46.044, and upon compliance with the terms hereof and 10.1 the issuance of such certificates, the bank may commence the 10.2 transaction of banking and trust company business and may 10.3 exercise, in addition to all the powers and privileges conferred 10.4 by law on state banks, the powers and privileges set forth in 10.5section 48.38sections 48A.07 and 48A.08, and the bank shall 10.6 thereafter comply with and be subject to all of the provisions 10.7 of law relating to state banks exercising such fiduciary powers 10.8 and privileges. 10.9 TRUST COMPANIES 10.10 Sec. 14. [48A.01] [ORGANIZATION OF A STATE TRUST COMPANY.] 10.11 Subdivision 1. [ARTICLES OF INCORPORATION.] (a) Subject to 10.12 the other provisions of this chapter, three or more persons may 10.13 organize and charter a state trust company for purposes of 10.14 transacting business as a trust company in conformity with the 10.15 applicable laws. 10.16 (b) A state trust company may be organized under section 10.17 300.025. If the trust company does not exercise banking powers, 10.18 it may exercise the powers of a Minnesota business corporation 10.19 reasonably necessary or helpful to enable exercise of its 10.20 specific powers under this chapter. 10.21 (c) A state trust company may be organized as a limited 10.22 liability company if it does not exercise banking powers. 10.23 The articles of incorporation or articles of organization 10.24 of the company must be signed and acknowledged by each organizer 10.25 and must contain: 10.26 (1) the name of the state trust company; 10.27 (2) the period of its duration, which may be perpetual; 10.28 (3) the powers of the state trust company, which may be 10.29 stated as: 10.30 (i) all powers granted to a state trust company in this 10.31 state; or 10.32 (ii) a list of the specific powers that the state trust 10.33 company chooses and is authorized to exercise; 10.34 (4) the aggregate number of shares or membership interests 10.35 that the state trust company will be authorized to issue, the 10.36 number of classes of shares or membership interests, which may 11.1 be one or more, the number of shares or membership interests of 11.2 each class if more than one class, and a statement of the par 11.3 value of the shares of each class or that the shares or 11.4 membership interests are to be without par value; 11.5 (5) if the shares or membership interests are to be divided 11.6 into classes, the designation of each class and statement of the 11.7 preferences, limitations, and relative rights of the shares or 11.8 membership interests of each class, which in the case of a 11.9 limited trust association may be more fully set forth in the 11.10 statement of membership interest; 11.11 (6) a provision limiting or denying to participants the 11.12 preemptive right to acquire additional or treasury membership 11.13 interests or shares of the state trust company; 11.14 (7) a provision granting the right of members or 11.15 shareholders to cumulative voting in the election of directors 11.16 or managers; 11.17 (8) the aggregate amount of consideration to be received 11.18 for all shares or membership interests initially issued by the 11.19 state trust company, and a statement that all authorized 11.20 contributions or shares have been subscribed and that all 11.21 subscriptions received provide for the consideration to be fully 11.22 paid in cash before the charter is issued; 11.23 (9) a provision consistent with law that the organizers 11.24 elect to set forth in the articles of incorporation or articles 11.25 of organization for the regulation of the internal affairs of 11.26 the state trust company or that is otherwise required by this 11.27 chapter to be set forth in the articles; 11.28 (10) the street address of the state trust company's 11.29 principal office; and 11.30 (11) the number of directors or governors constituting the 11.31 initial board, which must not be fewer than five or more than 11.32 25, and a statement that management is vested in a board. 11.33 Subd. 2. [DIRECTORS OR MANAGERS; QUALIFICATIONS; 11.34 VACANCIES; HOW FILLED.] A majority of the directors or governors 11.35 of a trust company must be residents of this state. Each must 11.36 take and subscribe an oath to diligently and honestly perform 12.1 the official duties of a director or manager and not knowingly 12.2 violate, or permit to be violated, any provision of law relating 12.3 to trust companies. The taking of this oath must be noted on 12.4 the minutes of the records of the corporation and filed with the 12.5 commissioner. Failure of a person selected as director to 12.6 qualify creates a vacancy in the board. All vacancies in the 12.7 board must be filled by the qualified members. However, not 12.8 more than one-third of the membership of the board may be so 12.9 filled in any one year. 12.10 Sec. 15. [48A.02] [APPLICATION FOR STATE TRUST COMPANY 12.11 CHARTER.] 12.12 Subdivision 1. [PROCEDURE.] An application for a trust 12.13 company charter must be in the form prescribed by the 12.14 commissioner. The procedure in sections 46.041 to 46.045 apply, 12.15 except for the conditions in section 46.044, subdivision 1, 12.16 clauses (1) to (6). 12.17 Subd. 2. [CONDITIONS.] The commissioner shall grant an 12.18 application for a trust company charter if: 12.19 (1) the applicants are of good moral character and 12.20 financial integrity; 12.21 (2) there is reasonable public demand for this trust 12.22 company in this location that: 12.23 (i) considers the needs of the community for trust service 12.24 of the kind applied for and the probable volume of trust 12.25 business available to the applicant; and 12.26 (ii) the probable volume of business in this location is 12.27 sufficient to ensure and maintain the solvency of the new trust 12.28 company and the solvency of the existing trust company or trust 12.29 companies in the locality; 12.30 (3) the commissioner is satisfied the proposed trust 12.31 company will be properly and safely managed considering: 12.32 (i) the general character and ability of the proposed 12.33 management; 12.34 (ii) the nature of the supervision to be given to the 12.35 proposed trust activities, including the qualifications and 12.36 experience of the members of the proposed trust investment 13.1 committee; 13.2 (iii) the qualifications, experience, and character of the 13.3 proposed executive officer or officers of the trust company; and 13.4 (iv) whether the trust company will have available 13.5 competent legal counsel to advise and pass upon trust matters 13.6 whenever necessary; 13.7 (4) the commissioner is satisfied that the capital funds 13.8 are available and the commissioner may accept any reasonable 13.9 demonstration including subscription agreements supported by 13.10 current financial statements; and 13.11 (5) any other facts and circumstances that the commissioner 13.12 considers proper. 13.13 The commissioner shall deny an application that does not 13.14 satisfy the requirements of this subdivision. 13.15 Sec. 16. [48A.03] [CAPITAL AND SURPLUS REQUIREMENTS OF 13.16 TRUST COMPANIES.] 13.17 Subdivision 1. [REQUIRED AMOUNT.] The capital of a trust 13.18 company organized under this chapter must be not less than 13.19 $500,000. The trust company must also provide a surplus of at 13.20 least 20 percent of its capital in addition to the capital 13.21 amounts required by this section. The capital or the surplus 13.22 must not be reduced without the approval of the commissioner of 13.23 commerce. In the case of a trust company organized as a limited 13.24 liability company, "capital and surplus" is considered the 13.25 "contribution" of its members reflected in the required records 13.26 of a limited liability company. 13.27 Subd. 2. [REQUIRED INVESTMENT.] No trust company shall 13.28 transact business until all of its authorized capital stock and 13.29 required surplus has been paid in, in cash, and at least 25 13.30 percent of the capital has been invested in one or more of the 13.31 first, second, third, and fourth classes of authorized 13.32 securities and railroad bonds, as described by section 48.37, 13.33 and also in the farm loan bonds issued by the federal land 13.34 banks, federal intermediate credit banks, and the banks for 13.35 cooperatives. These investments must be assigned and 13.36 transferred to and deposited with the state treasurer, provided, 14.1 however, that no trust company shall be required to deposit 14.2 securities in excess of $1,000,000. The state treasurer shall 14.3 submit the securities deposited according to this subdivision to 14.4 the commissioner. The commissioner shall carefully examine the 14.5 securities offered for deposit and determine if they comply with 14.6 all applicable provisions of law. Upon receipt of an order of 14.7 the commissioner, the state treasurer shall issue a receipt. 14.8 This deposit must be maintained unimpaired as a guaranty fund 14.9 for depositors and creditors and for the faithful discharge of 14.10 the trust company's duties, with the right to collect the income 14.11 from it and to substitute other similar authorized securities, 14.12 of equal amount and value, upon approval and order of the 14.13 commissioner. 14.14 If the securities comply with the law, the commissioner 14.15 shall issue a certificate of authorization for the trust company 14.16 to begin business. 14.17 Subd. 3. [REDUCTION OF CAPITAL STOCK.] The capital stock 14.18 of a trust company may be reduced with the approval of the 14.19 commissioner, but not below the minimum amounts in this 14.20 section. A trust company shall not return assets to the 14.21 stockholders unless its deposits of authorized securities after 14.22 the return equal one-fourth of the reduced capital, which in no 14.23 event may be less than $125,000. The liability of a stockholder 14.24 or participant upon an existing contract is not affected by the 14.25 return of assets. 14.26 Subd. 4. [REQUIREMENTS FOR CONSOLIDATED COMPANIES.] When 14.27 two or more trust companies have been or are consolidated under 14.28 sections 49.34 to 49.41, or, in the case of a limited liability 14.29 company, sections 322B.70 to 322B.75, the capital of the 14.30 consolidated trust company is considered substituted for the 14.31 capital of the several trust companies entering into the 14.32 consolidation, and the aggregate of the securities of these 14.33 trust companies on deposit with the state treasurer, according 14.34 to this section, must be increased or diminished accordingly. 14.35 Subd. 5. [REQUIREMENTS FOR LIMITED PURPOSE COMPANIES.] A 14.36 company may also be organized, with its principal place of 15.1 business in the state, with a capital of not less than $10,000, 15.2 to be paid in cash, of which 50 percent must be invested in 15.3 authorized securities and deposited with the state treasurer, as 15.4 provided in this section. The powers and business of the 15.5 company must be to act as assignee under an assignment for the 15.6 benefit of creditors, or be appointed and act as a trustee or 15.7 receiver, as a guardian, as executor of a will, or administrator 15.8 of an estate. The company may accept and perform any other 15.9 lawful trust over which a state or federal court has 15.10 jurisdiction. The company, before entering upon the duties of 15.11 its trust, shall give a surety bond in the sum the court 15.12 directs, with sufficient surety, conditioned for the faithful 15.13 performance of its duties. The business of a company is limited 15.14 to the matters in this subdivision. A company with a capital 15.15 stock of less than $10,000 shall not use the word "trust" in the 15.16 title or name of the company. 15.17 Sec. 17. [48A.04] [CERTAIN TRUST COMPANIES MAY ASSUME 15.18 POWERS OF STATE BANKS.] 15.19 Subdivision 1. [AUTHORITY.] Upon complying with the terms 15.20 of this section, a trust company organized under section 300.025 15.21 has all the powers and privileges of a state bank not otherwise 15.22 granted to trust companies and is subject to and must comply 15.23 with all the laws of this state applicable to state banks. 15.24 Subd. 2. [APPLICATION.] In considering the application of 15.25 a trust company to assume the powers of a state bank, the 15.26 department shall proceed in the same manner and be governed by 15.27 the same laws that are applicable to applications for charters 15.28 for new state banks. 15.29 Subd. 3. [CERTIFICATES TO BE AMENDED.] In order to 15.30 exercise the powers granted under this subdivision, the trust 15.31 company shall amend its certificate of incorporation to include 15.32 the additional powers of a state banking corporation. This 15.33 amendment may include the change of the corporate name of the 15.34 trust company. The trust company shall display in its place of 15.35 business the certificate of the authorization issued by the 15.36 commissioner of commerce. 16.1 Amendments to the certificate of incorporation must be made 16.2 under section 300.45. Before becoming effective, these 16.3 amendments must be approved by the department and the approval 16.4 must be endorsed upon the certificate of amendment. 16.5 Subd. 4. [TRUST COMPANIES TO COMPLY WITH CERTAIN LAWS.] No 16.6 trust company of this state shall conduct a banking business, as 16.7 defined in section 47.02, exercising deposit taking powers, 16.8 without complying with the reserve requirements of section 16.9 48.221. 16.10 Sec. 18. [48A.05] [NATIONAL ASSOCIATIONS; POWERS.] 16.11 The commissioner of commerce may authorize trust companies 16.12 organized under the laws of this state to engage in trust 16.13 activity in which banks exercising trust powers subject to the 16.14 jurisdiction of the federal government may be authorized to 16.15 engage. The commissioner may not authorize trust companies to 16.16 engage in an activity prohibited by the laws of this state. 16.17 Sec. 19. [48A.06] [PROHIBITED DEALINGS AND INDEBTEDNESS.] 16.18 (a) A trust company shall not engage in banking, 16.19 mercantile, manufacturing, or other business, unless this 16.20 business is expressly authorized in this chapter. 16.21 (b) A trust company shall not lend its funds, money, 16.22 capital, trust funds, or other property to a director, officer, 16.23 agent, or employee. 16.24 (c) A director, officer, agent, or employee of a trust 16.25 company shall not become indebted to it by means of an 16.26 overdraft, promissory note, account, endorsement, guaranty, or 16.27 any other contract. A director, officer, agent, or employee who 16.28 violates this paragraph is guilty of theft of the amount of the 16.29 indebtedness from the time of its creation. 16.30 FIDUCIARY PROVISIONS OF BANKS AND TRUST COMPANIES 16.31 Sec. 20. [48A.07] [TRUST COMPANY OR BANK; SPECIAL POWERS 16.32 AND DUTIES AS FIDUCIARY.] 16.33 Subdivision 1. [QUALIFYING ORGANIZATIONS.] A trust 16.34 company, or bank that holds a certificate as provided in section 16.35 48.37, may exercise the powers and privileges set forth in this 16.36 section. 17.1 Subd. 2. [TAKING AND HOLDING REAL AND PERSONAL PROPERTY IN 17.2 TRUST.] (a) The bank or trust company may take and hold in trust 17.3 any real or personal property, wherever situated, by order, 17.4 judgment, or decree of a court, or by gift, grant, assignment, 17.5 transfer, devise, legacy, or bequest from, or by lawful contract 17.6 with, a public or private corporation or an individual or 17.7 copartnership. It may manage this real or personal property 17.8 upon the terms and conditions declared or imposed. 17.9 (b) The bank or trust company may act as agent for the 17.10 signatures, countersignatures, registration, transfer, or 17.11 redemption of certificates of stock, bonds, coupons, or other 17.12 evidences of indebtedness. 17.13 (c) The bank or trust company may act as trustee under 17.14 mortgages in the form of trust deeds. 17.15 (d) The bank or trust company may act as general or special 17.16 agent or attorney in fact in the acquisition, management, sale, 17.17 assignment, transfer, encumbrance, conveyance, or other 17.18 disposition of real or personal property, in the collection of 17.19 rents, payment of taxes, and generally as the representative of 17.20 a person, corporation, or copartnership. 17.21 (e) The bank or trust company may guarantee the title to 17.22 securities sold and transferred by it. 17.23 Subd. 3. [TAKING AND HOLDING DEPOSITS.] The bank or trust 17.24 company may take and hold on deposit or for safekeeping, money, 17.25 bonds, stocks, or other securities, or personal property, that: 17.26 (1) is given to it by a public officer or a trustee or other 17.27 legal representative or a public or private corporation or a 17.28 person; or (2) is authorized, ordered, or otherwise required by 17.29 law to be deposited in a safe depository or paid into any court 17.30 of record. If a court orders the deposit, and the depositor 17.31 takes the receipt of the bank or trust company for it, the 17.32 depositor and the depositor's sureties are relieved from 17.33 liability on the deposits while they are held by the bank or 17.34 trust company. With respect to trust companies only, deposits 17.35 do not include checking or savings accounts, certificates of 17.36 deposit, or other liabilities not relating to its fiduciary 18.1 activities, except as may be authorized by sections 47.23 and 18.2 48A.04. 18.3 Subd. 4. [ACCEPTING AND PERFORMING ASSIGNMENTS OR TRUSTS.] 18.4 The bank or trust company may act as assignee under an 18.5 assignment for the benefit of creditors, or be appointed as a 18.6 trustee, receiver, guardian, executor, or administrator, and may 18.7 accept and perform any other lawful trust conferred by a court 18.8 or by a corporation or individual. No oath or security is 18.9 required of a bank or trust company accepting or performing a 18.10 trust under this subdivision. 18.11 Subd. 5. [COURT-ORDERED DEPOSIT OF SECURITIES.] The judge 18.12 or court having jurisdiction may direct an executor, 18.13 administrator, guardian, assignee, receiver, or other trustee to 18.14 deposit with the bank or trust company any securities belonging 18.15 to the trust subject to the order of the trustee when 18.16 countersigned by the judge of the court. The court may fix the 18.17 security to be given by the trustee with reference only to the 18.18 remainder of the trust estate. Securities may not be withdrawn 18.19 and no part of the principal or interest of the securities may 18.20 be collected without a court order. However, an officer of the 18.21 bank or trust company, upon satisfactory proof that additional 18.22 security has been furnished by the trustee or that the estate or 18.23 fund has been so reduced that the deposit is no longer required, 18.24 may withdraw securities or collect the principal of or interest 18.25 on the securities. 18.26 Subd. 6. [INVESTMENT AUTHORITY.] (a) The bank or trust 18.27 company may, in its discretion, retain and continue an 18.28 investment and security or securities coming into its possession 18.29 in a fiduciary capacity. 18.30 (b) In the absence of an express prohibition in the trust 18.31 instrument, the trustee may acquire and retain securities of an 18.32 open-end or closed-end management company or unit investment 18.33 trust registered under the federal Investment Company Act of 18.34 1940. The fact that the banking institution or an affiliate of 18.35 the banking institution, is providing services to the investment 18.36 company or trust as investment advisor, sponsor, broker, 19.1 distributor, custodian, transfer agent, registrar, or otherwise, 19.2 and receiving compensation for the services does not preclude 19.3 the trustee from investing in the securities of that investment 19.4 company or trust. The banking institution shall disclose to all 19.5 current income beneficiaries of the trust the rate, formula, and 19.6 method of the compensation. This paragraph does not alter the 19.7 degree of care and judgment required of trustees by section 19.8 501B.151. 19.9 (c) Except as otherwise provided in this subdivision, a 19.10 bank or trust company shall invest an amount not less than $500 19.11 received by it as representative or trustee or by order of the 19.12 court, not required for the purposes of the trust and not to be 19.13 accounted for within one year, as provided in this subdivision, 19.14 in authorized securities then held by it or specially procured 19.15 by it. Except as may be otherwise provided in the governing 19.16 will, trust agreement, court order, or other instrument, any 19.17 amount in any one trust account, may be invested in certificates 19.18 of deposit or savings accounts in the same bank, or any other 19.19 bank or banks if the certificates of deposit or savings accounts 19.20 are fully insured by the Federal Deposit Insurance Corporation 19.21 and receive the prevailing rate of interest on the certificates 19.22 or savings accounts. 19.23 (d) Where funds are invested in authorized securities, as 19.24 defined by law, the provisions of section 48.24 limiting the 19.25 amount of liability of a person, corporation, or copartnership, 19.26 with reference to a percentage of the capital and surplus of the 19.27 bank, does not apply. 19.28 (e) A bank or trust company may invest all money received 19.29 by it in trust in authorized securities. It is responsible to 19.30 the owner or cestui que trust for the validity, regularity, 19.31 quality, value, and genuineness of these investments and 19.32 securities at the time they are made. It is also responsible to 19.33 the owner or cestui que trust for the safekeeping of these 19.34 securities and evidences of them. When special directions are 19.35 given in an order, judgment, decree, will, or other written 19.36 instrument as to the particular manner or the particular class 20.1 or kind of securities or property in which an investment must be 20.2 made, the bank or trust company must follow these directions and 20.3 is not responsible for the performance of the trust. In all 20.4 other cases it may invest funds held in any trust capacity in 20.5 authorized securities using its best judgment in the selection 20.6 of them, and is responsible for the validity, regularity, 20.7 quality, and value of them at the time made, and for their 20.8 safekeeping. 20.9 (f) As the sole trustee or one of two or more cotrustees, 20.10 it may invest in fractional parts of, as well as in whole, 20.11 securities, or may commingle funds for investment. If it 20.12 invests in fractional parts of securities or commingles funds 20.13 for investment, all of the fractional parts of the securities, 20.14 or the whole of the funds so commingled must be owned and held 20.15 by the bank or trust company in its several trust capacities. 20.16 The bank or trust company is liable for the administration of 20.17 these trusts in all respects as though separately invested. Not 20.18 more than $100,000, at the cost price of the investments, may be 20.19 invested for any one trust at any one time in fractional parts 20.20 or as commingled funds for investment by a bank or trust company 20.21 having capital and surplus of less than $500,000, unless the 20.22 authority to invest in fractional parts or as commingled funds 20.23 is given in the order, judgment, decree, will, or other written 20.24 instrument governing the trust. Funds so commingled for 20.25 investment must be designated collectively as a common trust 20.26 fund. The trust company or bank shall maintain the common trust 20.27 fund in conformity with the rules and regulations prevailing 20.28 from time to time of the federal governmental agency that 20.29 regulates the collective investment of trust funds by national 20.30 banks. It may, in its discretion, retain and continue an 20.31 investment and security or securities coming into its possession 20.32 in any fiduciary capacity. Paragraphs (a) to (f) apply whether 20.33 a corporate trustee is acting alone or with an individual 20.34 cotrustee. 20.35 (g) Notwithstanding the provisions of paragraph (f), a bank 20.36 or trust company may: 21.1 (1) establish and maintain common trust funds for the 21.2 collective investment of funds held in a fiduciary capacity by 21.3 it or by another bank or trust company that is owned or 21.4 controlled by a corporation that owns or controls the bank or 21.5 trust company; and 21.6 (2) as a fiduciary or cofiduciary, invest funds that it 21.7 holds for investment in common trust funds established and 21.8 maintained according to clause (1) if the investment is not 21.9 prohibited by the instrument, judgment, decree, or order 21.10 creating the fiduciary relationship. This section applies to 21.11 fiduciary relationships now in existence or hereafter created. 21.12 To the extent not inconsistent with this paragraph, the 21.13 provisions of paragraph (f) relating to common trust funds apply 21.14 to the establishment and maintenance of common trust funds under 21.15 this paragraph. 21.16 (h) A bank or trust company is entitled to reasonable 21.17 compensation for the faithful performance of its duties and 21.18 discharge of its trust, including all necessary expenses and 21.19 interest at the legal rate, or the amount that has been or may 21.20 be agreed upon by the parties. No compensation or commission 21.21 paid or agreed to be paid by it for the negotiation of a loan, 21.22 or the execution of a trust, is considered interest within the 21.23 meaning of the law, and no excess over the legal rate of 21.24 interest is considered usury. 21.25 Sec. 21. [48A.08] [INCIDENTAL INVESTMENTS, POWERS, AND 21.26 LIMITATIONS.] 21.27 Subdivision 1. [QUALIFYING ORGANIZATION.] A trust company, 21.28 or a bank that holds a certificate as provided in section 48.37, 21.29 may exercise the powers and privileges set forth in this section. 21.30 Subd. 2. [INVESTMENT POWERS.] (a) The bank or trust 21.31 company may acquire, use, and improve, and for that purpose 21.32 mortgage, lease, sell, and convey, real and personal property 21.33 that is necessary for the transaction of its business. 21.34 (b) The bank or trust company may sell or continue to hold 21.35 and use for its interests or those of the estate or trust to 21.36 which it belongs an estate or interest in real estate that the 22.1 bank or trust company acquires through foreclosure of a 22.2 mortgage, trust deed, or other security, or by the settlement of 22.3 an obligation or otherwise in the course of its business. 22.4 (c) The bank or trust company may become the purchaser at a 22.5 foreclosure or judicial sale to which it is a party as trustee 22.6 or otherwise. 22.7 (d) The bank or trust company may accept or make a deed, 22.8 mortgage, or other instrument necessary for the transaction of 22.9 its business. It may loan money and secure the loans by 22.10 mortgage, trust deed or pledge, and/or purchase. It may sell 22.11 and assign notes, bonds, mortgages, and other evidences of 22.12 indebtedness, and securities, and convert them into cash or into 22.13 other authorized securities, or securities and property not 22.14 expressly prohibited by this chapter. 22.15 (e) The investment of funds owned by the trust company, as 22.16 distinguished from funds held by it in trust, are restricted to 22.17 authorized securities. 22.18 (f) The bank or trust company may guarantee a title to 22.19 securities sold and transferred by it. 22.20 (g) The bank or trust company may become sole surety upon a 22.21 bond. For trust companies organized after April 10, 1965, the 22.22 bond must pertain to its own fiduciary activities. 22.23 (h) The bank or trust company may maintain and operate safe 22.24 deposit vaults. 22.25 (i) The bank or trust company shall not invest its capital 22.26 or surplus in real estate except as authorized. It shall not 22.27 invest deposits, trust funds, or property except as authorized, 22.28 or under or by virtue of an express contract, judgment, or other 22.29 instrument conferring or imposing special power and authority so 22.30 to do. 22.31 Subd. 3. [POWERS OF COURT; ANNUAL REPORT TO THE 22.32 COURT.] The bank or trust company is subject at all times to the 22.33 orders, judgments, and decrees of a court of record from which 22.34 it has accepted a trust, appointment, or commission as to the 22.35 trust. It shall provide to the court itemized and verified 22.36 accounts, statements, and reports required by law, or as the 23.1 court orders as to a particular trust. The bank or trust 23.2 company is subject to the general jurisdiction and authority of 23.3 the district court of the county of its principal place of 23.4 business. 23.5 Sec. 22. [48A.09] [DEFINITIONS.] 23.6 Subdivision 1. [TERMS.] For purposes of this section and 23.7 section 48A.10, the terms defined in this section have the 23.8 meanings given them. 23.9 Subd. 2. [AFFILIATED BANK.] "Affiliated bank," with 23.10 respect to another bank or a trust company, means a bank that is 23.11 owned or controlled by the corporation that owns or controls 23.12 that other bank or trust company, including a wholly owned 23.13 subsidiary of the other bank or trust company. 23.14 Subd. 3. [BANK.] "Bank" means a state bank permitted to 23.15 exercise trust powers under sections 48.37 to 48.47, and a 23.16 national bank authorized to exercise fiduciary powers under the 23.17 laws of the United States, including a national bank whose 23.18 operations are limited to those of a trust company and related 23.19 activities. 23.20 Subd. 4. [FIDUCIARY CAPACITY.] "Fiduciary capacity" means 23.21 a capacity resulting from a bank undertaking to act alone or 23.22 jointly with others primarily for the benefit of another in all 23.23 matters connected with its undertaking. The term includes, but 23.24 is not limited to, the capacities of trustee, including trustee 23.25 of a common trust fund; executor; administrator; personal 23.26 representative; registrar or transfer agent with respect to 23.27 stocks, bonds, or other evidences of indebtedness of a 23.28 corporation, association, municipality, state or public 23.29 authority; guardian of estates; conservator; receiver; escrow 23.30 agent; agent for the investment of money; attorney-in-fact; or 23.31 any other similar capacity. 23.32 Subd. 5. [TRUST COMPANY.] "Trust company" means a trust 23.33 company incorporated under the laws of this state that is duly 23.34 authorized to exercise fiduciary powers. 23.35 Sec. 23. [48A.10] [SUBSTITUTION; PROCEDURE.] 23.36 Subdivision 1. [APPLICATION.] A bank or trust company may 24.1 file an application with the district court in the county in 24.2 which an affiliated bank or other bank or trust company for 24.3 which it seeks to be substituted is located requesting that it 24.4 be substituted, except as is expressly excluded in the 24.5 application, in every fiduciary capacity held by the affiliated 24.6 bank or other bank or trust company that is specified in the 24.7 application. The affiliated bank or other bank or trust company 24.8 for which substitution is sought shall join in the application. 24.9 The application need not list the fiduciary capacities in which 24.10 substitution is requested. 24.11 Subd. 2. [HEARING NOTICE.] When the application is filed 24.12 with the district court, the court shall set a date and time for 24.13 hearing and direct that notice of the hearing be given as 24.14 provided in this subdivision. The applicant shall cause a copy 24.15 of the notice to be published at least once a week for two 24.16 consecutive weeks in a legal newspaper in the county where the 24.17 hearing is to be held, the last publication of which is to be at 24.18 least ten days before the time set for the hearing. The court 24.19 may require additional notice as it considers necessary. A 24.20 defect in giving notice does not limit or affect the validity of 24.21 an order entered according to this section. 24.22 Subd. 3. [ORDER.] Upon finding that the applicant is 24.23 authorized to exercise fiduciary powers, the district court 24.24 shall enter an order substituting the applicant bank or trust 24.25 company in every fiduciary capacity held by the affiliated bank 24.26 or other bank or trust company for which substitution is sought 24.27 and which joined in the application, except as may be otherwise 24.28 specified in the application, and except for fiduciary 24.29 capacities in any account with respect to which a person 24.30 beneficially interested in the account has filed objection to 24.31 the substitution and has appeared and been heard in support of 24.32 the objection. Upon entry of the order, or at a later date as 24.33 may be specified in the order, the applicant bank or trust 24.34 company is substituted in every fiduciary capacity to which the 24.35 order extends. The substitution may be made a matter of record 24.36 in any county of this state by filing a certified copy of the 25.1 order of substitution in the office of the court administrator 25.2 of a district or county court, or by filing a certified copy of 25.3 the order in the office of the county recorder. 25.4 Subd. 4. [EFFECT OF SUBSTITUTION.] A designation in a will 25.5 or other instrument of an affiliated bank as fiduciary is 25.6 considered a designation of the bank or trust company 25.7 substituted for the affiliated bank according to this section 25.8 except where the will or other instrument is executed after the 25.9 substitution and expressly provides that this section does not 25.10 apply. Except as otherwise provided in this subdivision, a 25.11 grant in a will or other instrument of a discretionary power is 25.12 considered conferred upon the bank or trust company substituted 25.13 as the fiduciary according to this section. 25.14 Subd. 5. [ACCOUNTING AND TRANSFER OF ASSETS.] An 25.15 affiliated bank or other bank or trust company shall account 25.16 jointly with the substituted bank or trust company for the 25.17 accounting period during which the substitution occurred. Upon 25.18 substitution according to this section, the affiliated bank or 25.19 other bank or trust company shall deliver to the substituted 25.20 bank or trust company all assets held by the affiliated bank or 25.21 other bank or trust company as fiduciary, except assets held for 25.22 fiduciary accounts with respect to which no substitution occurs. 25.23 Upon substitution, all assets become the property of the 25.24 substituted bank or trust company without the necessity of any 25.25 instrument of transfer or conveyance. 25.26 Subd. 6. [TRANSFER OF TRUSTS TO COMPANY; CONDITION.] The 25.27 trustees of an estate or property may surrender and resign the 25.28 trust in favor of the trust company that will accept the trust 25.29 and convey and deliver to it all property and assets of the 25.30 trust, upon condition that the grantor, cestui que trust, and 25.31 all parties in any manner interested in the execution and 25.32 performance of the trust shall execute, acknowledge, and deliver 25.33 an instrument in writing, consenting to the transfer, releasing 25.34 and discharging the original trustee, and appointing the trust 25.35 company as successor. If either party to the original trust is 25.36 dead or does not join in the written consent, or if the original 26.1 trust was created under a last will or an order or decree of a 26.2 court of record, then the transfer is not valid except after 26.3 full compliance with the judgment or decree of a court having 26.4 jurisdiction to remove the acting trustee. 26.5 Subd. 7. [TRUST FUNDS; INVESTMENT OF ACCUMULATIONS.] A 26.6 bank or trust company that receives $500 or more as executor, 26.7 administrator, guardian, or other trustee, or by order of court, 26.8 that is not required for the purposes of the trust, or does not 26.9 have to be accounted for within one year, shall invest it as 26.10 soon as practicable in authorized securities either then held by 26.11 it or specially obtained by it. The income, less its proper 26.12 charges, becomes part of the trust estate. The net 26.13 accumulations on the income must be invested, accounted for, and 26.14 allowed in the settlement of the trust. 26.15 Except as may be otherwise provided in the governing will, 26.16 trust agreement, court order, or other instrument, any amount in 26.17 a trust account may be invested in certificates of deposit, 26.18 share certificates, or savings accounts in a bank or banks, or 26.19 credit union, if the beneficial owner is a member, if the 26.20 certificates of deposit, share certificates, or savings accounts 26.21 are fully insured by an agency of the federal government 26.22 insuring deposits and receive the prevailing rate of interest on 26.23 the certificates or savings accounts. 26.24 Sec. 24. [48A.11] [NATIONAL BANKS AS FIDUCIARIES.] 26.25 A national bank in this state granted a special permit to 26.26 act in a fiduciary capacity by either the Federal Reserve Board 26.27 under subsection K of section 11 of the Federal Reserve Act, as 26.28 amended by the act of September 26, 1918, or the Office of the 26.29 Comptroller of the Currency under the provisions of United 26.30 States Code, title 12, section 92a, may without oath or security 26.31 assign, transfer to, and deposit with the commissioner, the 26.32 kinds and amounts of authorized securities required by section 26.33 48A.03 of a bank or trust company in a city in which the 26.34 national bank is located. If the national bank has a capital of 26.35 $500,000 or more, it is not required to deposit these securities 26.36 for more than the lesser of ten percent of this capital or 27.1 $1,000,000. The securities so deposited must be held and 27.2 maintained as a guaranty fund for the national bank for the 27.3 performance of its duties in this fiduciary capacity. 27.4 When a national bank has complied with section 48A.03, no 27.5 oath or security is required of it to accept and perform the 27.6 trust, as provided in section 48A.07, subdivision 4. 27.7 For purposes of this section, "bank" and "trust company" 27.8 have the meanings given in section 48A.09. 27.9 TRUST INSTITUTION OFFICES 27.10 Sec. 25. [48A.12] [DEFINITIONS.] 27.11 Subdivision 1. [TERMS.] For purposes of sections 48A.12 to 27.12 48A.25, the following words and phrases have the meanings given 27.13 them: 27.14 Subd. 2. [ACCOUNT.] "Account" means the client 27.15 relationship established with a trust company involving the 27.16 transfer of funds or property to the trust company, including a 27.17 relationship in which the trust company acts as trustee, 27.18 executor, administrator, guardian, custodian, conservator, 27.19 bailee, receiver, registrar, or agent, but excluding a 27.20 relationship in which the trust company acts solely in an 27.21 advisory capacity. 27.22 Subd. 3. [ADMINISTER.] "Administer" with respect to real 27.23 or tangible personal property means, as an agent or in another 27.24 representative capacity, to possess, purchase, sell, lease or 27.25 insure, safekeep, or otherwise manage the property. 27.26 Subd. 4. [AFFILIATE.] "Affiliate" means a company that 27.27 directly or indirectly controls, is controlled by, or is under 27.28 common control with a trust institution or other company. 27.29 Subd. 5. [BANK.] "Bank" has the meaning given the term in 27.30 United States Code, title 12, section 1813(h). The term "bank" 27.31 does not include a "foreign bank" as defined in United States 27.32 Code, title 12, section 3101(7), except for a foreign bank 27.33 organized under the laws of a territory of the United States, 27.34 Puerto Rico, Guam, American Samoa, or the Virgin Islands, the 27.35 deposits of which are insured by the Federal Deposit Insurance 27.36 Corporation. 28.1 Subd. 6. [BANK SUPERVISORY AGENCY.] "Bank supervisory 28.2 agency" means: 28.3 (1) an agency of another state with primary responsibility 28.4 for chartering and supervising a trust institution; and 28.5 (2) the Office of the Comptroller of the Currency, the 28.6 Federal Deposit Insurance Corporation, the Board of Governors of 28.7 the Federal Reserve System, the Office of Thrift Supervision, 28.8 and any successor to these agencies. 28.9 Subd. 7. [BRANCH.] "Branch," with respect to a trust 28.10 company or depository institution, has the meaning given in 28.11 section 48A.17 and in sections 47.51 and 49.411, subdivision 2, 28.12 paragraph (d). 28.13 Subd. 8. [CHARTER.] "Charter" means a charter, license, or 28.14 other authority issued by the commissioner or a bank supervisory 28.15 agency authorizing a trust institution to act as a fiduciary in 28.16 its home state. 28.17 Subd. 9. [CLIENT.] "Client" means a person to whom a trust 28.18 institution owes a duty or obligation under a trust or other 28.19 account administered by the trust institution or as an advisor 28.20 or agent, regardless of whether the trust institution owes a 28.21 fiduciary duty to the person. The term includes the 28.22 noncontingent beneficiaries of an account. 28.23 Subd. 10. [COMMISSIONER.] "Commissioner" means the 28.24 commissioner of commerce and, where appropriate, all of the 28.25 commissioner's successors and predecessors in office. 28.26 Subd. 11. [COMPANY.] "Company" includes a bank, trust 28.27 company, corporation, limited liability company, partnership, 28.28 association, business trust, or another trust. 28.29 Subd. 12. [DEPARTMENT.] "Department" means the Minnesota 28.30 commerce department. 28.31 Subd. 13. [FIDUCIARY RECORD.] "Fiduciary record" means a 28.32 matter written, transcribed, recorded, received, or otherwise in 28.33 the possession or control of a trust company, whether in 28.34 physical, electromagnetic, or optical disk form, that is 28.35 necessary to preserve information concerning an act or event 28.36 relevant to an account or a client of a trust company. 29.1 Subd. 14. [HOME STATE.] "Home state" means: 29.2 (1) with respect to a federally chartered trust 29.3 institution, the state in which the institution maintains its 29.4 principal office; and 29.5 (2) with respect to any other trust institution, the state 29.6 that chartered the institution. 29.7 Subd. 15. [HOME STATE REGULATOR.] "Home state regulator" 29.8 means the bank supervisory agency with primary responsibility 29.9 for chartering and supervising an out-of-state trust institution. 29.10 Subd. 16. [HOST STATE.] "Host state" means a state, other 29.11 than the home state of a trust institution, in which the trust 29.12 institution maintains or seeks to acquire or establish an office. 29.13 Subd. 17. [NEW TRUST OFFICE.] "New trust office" means a 29.14 trust office located in a host state that: 29.15 (1) is originally established by the trust institution as a 29.16 trust office; and 29.17 (2) does not become a trust office of the trust institution 29.18 as a result of: 29.19 (i) the acquisition of another trust institution or trust 29.20 office of another trust institution; or 29.21 (ii) a merger, consolidation, or conversion involving the 29.22 trust institution or trust office. 29.23 Subd. 18. [OFFICE.] "Office," with respect to a trust 29.24 institution, means the principal office, a trust office, or a 29.25 representative trust office, but not a detached facility. 29.26 Subd. 19. [OUT-OF-STATE BANK.] "Out-of-state bank" means a 29.27 bank chartered to act as a fiduciary in a state or states other 29.28 than this state. 29.29 Subd. 20. [OUT-OF-STATE TRUST COMPANY.] "Out-of-state 29.30 trust company" means a trust company that is not a state trust 29.31 company whose principal office is not located in this state. 29.32 Subd. 21. [OUT-OF-STATE TRUST INSTITUTION.] "Out-of-state 29.33 trust institution" means a trust institution that is not a state 29.34 trust institution. 29.35 Subd. 22. [PRINCIPAL OFFICE.] "Principal office" with 29.36 respect to: 30.1 (1) a state trust company, means a location registered with 30.2 the commissioner as the state trust company's home office at 30.3 which: 30.4 (i) the state trust company does business; 30.5 (ii) the state trust company keeps its corporate books and 30.6 a set of its material records, including material fiduciary 30.7 records; and 30.8 (iii) at least one executive officer of the state trust 30.9 company maintains an office; or 30.10 (2) a trust institution other than a state trust company, 30.11 means its principal place of business in the United States. 30.12 Subd. 23. [REGISTRATION.] "Registration" means the process 30.13 by which a trust institution has been authorized by the 30.14 commissioner to acquire, establish, or maintain a representative 30.15 trust office in this state. 30.16 Subd. 24. [REPRESENTATIVE TRUST OFFICE.] "Representative 30.17 trust office" means an office at which a trust institution has 30.18 been authorized by the commissioner to engage in a trust 30.19 business other than: 30.20 (1) accepting or executing trusts, including to: 30.21 (i) act as trustee under a written agreement; 30.22 (ii) receive money or other property in its capacity as a 30.23 trustee for investment in real or personal property; 30.24 (iii) act as trustee and perform the fiduciary duties 30.25 committed or transferred to it by order of court of competent 30.26 jurisdiction; 30.27 (iv) act as trustee of the estate of a deceased person; or 30.28 (v) act as trustee for a minor or incapacitated person; 30.29 (2) administering in any other fiduciary capacity real or 30.30 personal property; or 30.31 (3) acting according to order of court of competent 30.32 jurisdiction as executor or administrator of the estate of a 30.33 deceased person or as a guardian or conservator for a minor or 30.34 incapacitated person. 30.35 Subd. 25. [STATE.] "State" means a state of the United 30.36 States, the District of Columbia, a territory of the United 31.1 States, Puerto Rico, Guam, American Samoa, the Trust Territory 31.2 of the Pacific Islands, the Virgin Islands, and the Northern 31.3 Mariana Islands. 31.4 Subd. 26. [STATE BANK AND TRUST.] "State bank and trust" 31.5 means a bank chartered by this state with the additional 31.6 authority to exercise fiduciary powers and privileges set out in 31.7 sections 48A.07 and 48A.08. 31.8 Subd. 27. [STATE TRUST COMPANY.] "State trust company" 31.9 means a corporation or a limited liability trust company 31.10 organized or reorganized under this chapter, including a trust 31.11 company organized under the laws of this state before the 31.12 effective date of this chapter. 31.13 Subd. 28. [STATE TRUST INSTITUTION.] "State trust 31.14 institution" means a trust institution chartered by the state. 31.15 Subd. 29. [TRUST BUSINESS.] "Trust business" means the 31.16 holding out by a person to the public by advertising, 31.17 solicitation, or other means that the person is available to 31.18 perform any service of a trust institution. 31.19 Subd. 30. [TRUST COMPANY.] "Trust company" means a state 31.20 trust company or other company chartered to act as a fiduciary 31.21 that is not a depository institution or a foreign bank. 31.22 Subd. 31. [TRUST INSTITUTION.] "Trust institution" means a 31.23 bank and trust, or trust company. 31.24 Subd. 32. [TRUST OFFICE.] "Trust office" means an office, 31.25 other than the principal office, at which a trust institution is 31.26 authorized by the commissioner to conduct any trust business 31.27 incidental to the trust business that it is permitted to conduct 31.28 at its principal office or branch. It may not accept deposits 31.29 except as incidental to the trust business. 31.30 Subd. 33. [UNAUTHORIZED ACTIVITY.] "Unauthorized activity" 31.31 means: 31.32 (1) a company, other than one identified in section 48.37, 31.33 48A.01, or 48A.11, acting as a fiduciary within this state; 31.34 (2) a company engaging in a trust business in this state at 31.35 an office of the company that is not its principal office, if it 31.36 is a state trust institution, or that is not a trust office or a 32.1 representative trust office of the company; or 32.2 (3) an out-of-state trust institution engaging in a trust 32.3 business in this state at any time an order issued by the 32.4 commissioner under section 48A.22 is in effect. 32.5 Sec. 26. [48A.13] [STATE TRUST COMPANY PRINCIPAL OFFICE.] 32.6 Subdivision 1. [REQUIREMENT.] A state trust company must 32.7 have and continuously maintain a principal office in this state. 32.8 Subd. 2. [SERVICE OF PROCESS.] Each executive officer at 32.9 the principal office is an agent of the state trust company for 32.10 service of process. 32.11 Subd. 3. [NOTICE OF CHANGE.] A state trust company not 32.12 authorized to engage in the business of banking may change its 32.13 principal office to a location within this state by filing a 32.14 written notice with the commissioner setting forth the name of 32.15 the state trust company, the street address of its principal 32.16 office before the change, the street address to which the 32.17 principal office is to be changed, and a copy of the resolution 32.18 adopted by the board authorizing the change. 32.19 The change of principal office takes effect on the 31st day 32.20 after the date the commissioner receives the notice under this 32.21 subdivision, unless the commissioner establishes an earlier or 32.22 later date or unless before that day the commissioner notifies 32.23 the state trust company that it must establish to the 32.24 satisfaction of the commissioner that the relocation is 32.25 consistent with the original determination made under section 32.26 48A.02, for the establishment of a state trust company at that 32.27 location, in which event the change of principal office takes 32.28 effect when approved by the commissioner. 32.29 Sec. 27. [48A.14] [STATE TRUST INSTITUTIONS; 32.30 REPRESENTATIVE TRUST OFFICES.] 32.31 Subdivision 1. [AUTHORITY.] (a) A state trust institution 32.32 may establish or acquire and maintain representative trust 32.33 offices anywhere in this state. A state trust institution may 32.34 establish or acquire and maintain the office by filing a written 32.35 notice with the commissioner setting forth the name of the state 32.36 trust institution and the location of the proposed additional 33.1 office, together with a copy of the resolution adopted by the 33.2 board authorizing the additional office, and a filing fee of 33.3 $250. 33.4 (b) The state trust institution may begin business at the 33.5 additional office on the 31st day after the date the 33.6 commissioner receives the notice, unless the commissioner 33.7 specifies an earlier or later date. 33.8 Subd. 2. [REVIEW BY COMMISSIONER.] The 30-day period of 33.9 review may be extended by the commissioner on a determination 33.10 that the written notice raises issues that require additional 33.11 information or additional time for analysis. If the period of 33.12 review is extended, the state trust institution may establish 33.13 the additional office only on prior written approval by the 33.14 commissioner. 33.15 Subd. 3. [DISAPPROVAL.] The commissioner may deny approval 33.16 of the additional office if the commissioner finds that the 33.17 state trust institution lacks sufficient financial resources to 33.18 undertake the proposed expansion without adversely affecting its 33.19 safety or soundness or that the proposed office would be 33.20 contrary to the public interest. 33.21 Sec. 28. [48A.15] [STATE BANKS AND TRUST COMPANIES; TRUST 33.22 SERVICE OFFICES.] 33.23 Subdivision 1. [AUTHORIZATION.] A trust company organized 33.24 under the laws of this state or a state bank and trust may, 33.25 after completing the notification procedure required by this 33.26 subdivision, establish and maintain a trust service office at 33.27 any office in this state of any other state or national bank. A 33.28 state bank may, after completing the notification procedure 33.29 required by this subdivision, permit a trust company organized 33.30 under the laws of this state or a state bank and trust or a 33.31 national bank in this state that is authorized to exercise trust 33.32 powers to establish and maintain a trust service office at any 33.33 of its banking offices. 33.34 The trust company or state bank and trust and a state bank 33.35 at which a trust service office is to be established according 33.36 to this section shall jointly file, on forms provided by the 34.1 commissioner, a notification of intent to establish a trust 34.2 service office. The notification must be accompanied by a 34.3 filing fee of $100 payable to the commissioner, to be deposited 34.4 in the general fund of the state. No trust service office shall 34.5 be established according to this section if disallowed by order 34.6 of the commissioner within 45 days of the filing of a complete 34.7 and acceptable notification of intent to establish a trust 34.8 service office. An order of the commissioner to disallow the 34.9 establishment of a trust service office under this section is 34.10 subject to judicial review under sections 14.63 to 14.69. 34.11 Subd. 2. [SERVICES PERMITTED.] The trust company or bank 34.12 and trust that establishes a trust service office under this 34.13 section may conduct at the office any trust business and 34.14 business incidental to the trust business that it is permitted 34.15 to conduct at its principal office. It may not accept deposits 34.16 except as incidental to the trust business. 34.17 Subd. 3. [GENERAL REQUIREMENTS FOR BANKS.] (a) If the bank 34.18 at which a trust service office is to be established has 34.19 exercised trust powers, then the trust company or bank and trust 34.20 that is establishing the trust service office shall enter into 34.21 an agreement respecting those fiduciary powers to which the 34.22 trust company or bank and trust shall succeed and shall file the 34.23 agreement with the commissioner. 34.24 (b) The trust company or bank and trust that is 34.25 establishing a trust service office under this section shall 34.26 publish a notice of the filing in the form prescribed by the 34.27 commissioner in a newspaper published in the municipality in 34.28 which the trust service office is to be located, and if there is 34.29 no such newspaper, then in a qualified newspaper likely to give 34.30 notice in the municipality in which the proposed trust service 34.31 office is to be located. The trust company or bank and trust 34.32 shall file proof of publication of the notice with the 34.33 commissioner immediately after the notice is published. 34.34 (c) After filing and publication, the trust company or bank 34.35 and trust establishing the trust service office shall, as of the 34.36 date the office first opens for business, succeed to and be 35.1 substituted for the bank at which the trust service office is 35.2 located as to all fiduciary powers, rights, duties, privileges, 35.3 and liabilities of the bank in its capacity as fiduciary for all 35.4 estates, trusts, conservatorships, guardianships, and other 35.5 fiduciary relationships of which the bank is then serving as 35.6 fiduciary, except as may be otherwise specified in the agreement 35.7 between the bank and the trust company or bank and trust which 35.8 has established the trust service office. 35.9 (d) The trust company or bank and trust that has 35.10 established the trust service office shall also be considered 35.11 named as fiduciary in all writings, including, but not limited 35.12 to, wills, trusts, court orders, and similar documents and 35.13 instruments, naming the bank at which the trust service office 35.14 is located signed before the date the trust service office first 35.15 opens for business, unless expressly negated by the writing or 35.16 otherwise specified in the agreement between the trust company 35.17 or bank and trust and the bank at which the trust service office 35.18 is located. 35.19 (e) On the effective date of the substitution, the bank at 35.20 which the trust service office has been established is released 35.21 and absolved from all fiduciary duties and obligations under the 35.22 writings and shall discontinue its exercise of trust powers on 35.23 all matters not specifically retained by the agreement. This 35.24 subdivision does not absolve the bank from liabilities arising 35.25 out of a breach of fiduciary duty or obligation occurring before 35.26 the date the trust service office first opens for business. 35.27 (f) This subdivision does not affect the authority, duties, 35.28 or obligations of a bank with respect to relationships that may 35.29 be established without trust powers, whether the relationships 35.30 arise before or after the establishment of the trust service 35.31 office. 35.32 Subd. 4. [SUPERVISION.] A trust company or state bank and 35.33 trust establishing and operating one or more trust service 35.34 offices according to this section shall at all times maintain 35.35 records acceptable to the commissioner regarding transactions 35.36 originating at the trust service offices and available at its 36.1 principal office for examination according to sections 46.04 and 36.2 46.05. 36.3 Subd. 5. [NATIONAL BANKS; REQUIREMENTS.] If a trust 36.4 service office is established by a national bank at the banking 36.5 office of another national bank, then the agreement respecting 36.6 fiduciary powers required by subdivision 3 must be filed with 36.7 the comptroller of the currency of the United States and the 36.8 notice required by subdivision 3 must be in the form prescribed 36.9 by the comptroller of the currency. 36.10 Subd. 6. [NOTICE OF SUBSTITUTIONS; DENIAL OF 36.11 SUBSTITUTION.] Not less than 60 days before the effective date 36.12 of the proposed substitution under subdivision 3 or 5, the 36.13 parties to the substitution shall send written notice of the 36.14 proposed substitution to each cofiduciary, each surviving 36.15 settlor of a trust, each conservatee or ward under a 36.16 conservatorship or guardianship, each person who alone or in 36.17 conjunction with others has the power to remove the fiduciary 36.18 being substituted, and each adult beneficiary currently 36.19 receiving or entitled to receive a distribution of principal or 36.20 income from a trust or estate with respect to which the 36.21 substitution is to be effected. Intentional failure to send the 36.22 notice to a party at the party's current address as shown on the 36.23 fiduciary's records makes the substitution of fiduciaries 36.24 ineffective with respect to the fiduciary relationship. An 36.25 unintentional failure to give notice does not impair the 36.26 validity or effect of any substitution of fiduciaries under 36.27 subdivision 3 or 5. A trust company or bank that is substituted 36.28 or about to be substituted as fiduciary with respect to a trust, 36.29 estate, conservatorship, or guardianship under subdivision 3 or 36.30 5 may be removed as fiduciary, or the substitution may be 36.31 denied, upon petition by a cofiduciary, by a beneficiary of a 36.32 trust or estate, by the settlor of a trust, or on behalf of a 36.33 conservatee or ward under a conservatorship or guardianship if 36.34 the trust company or bank files a written consent to its removal 36.35 or a written declination to act, or if the court having 36.36 jurisdiction over the fiduciary relationship, upon notice and 37.1 hearing, approves the petition as in the best interests of the 37.2 petitioner and all other parties interested in the trust, 37.3 estate, conservatorship, or guardianship. This section applies 37.4 in addition to any applicable provision for removal of a 37.5 fiduciary or appointment of a successor fiduciary in any other 37.6 statute or in the instrument creating the fiduciary relationship. 37.7 Sec. 29. [48A.16] [DETACHED FACILITIES.] 37.8 A state trust institution may establish or acquire and 37.9 maintain detached facilities for the conduct of any or all of 37.10 the activities permitted for a trust institution following the 37.11 procedure and in compliance with sections 47.52 to 47.57. 37.12 Sec. 30. [48A.17] [AUTHORITY FOR OUT-OF-STATE TRUST 37.13 OFFICES; PRIOR WRITTEN NOTICE.] 37.14 (a) A state trust institution may establish and maintain a 37.15 new trust office or a representative trust office or acquire and 37.16 maintain an office in a state other than this state. The state 37.17 trust institution shall: 37.18 (1) file a notice on a form prescribed by the commissioner 37.19 stating the name of the state trust institution, the location of 37.20 the proposed office, and whether the laws of the jurisdiction 37.21 where the office will be located permit the office to be 37.22 maintained by the state trust institution; 37.23 (2) furnish a copy of the resolution adopted by the board 37.24 authorizing the out-of-state office; and 37.25 (3) pay the filing fee of $250. 37.26 (b) The state trust institution may begin business at the 37.27 additional office on the 31st day after the date the 37.28 commissioner receives the notice, unless the commissioner 37.29 specifies an earlier or later date. 37.30 (c) The 30-day period of review may be extended by the 37.31 commissioner if the written notice raises issues that require 37.32 additional information or additional time for analysis. If the 37.33 period of review is extended, the state trust institution may 37.34 establish the additional office only on prior written approval 37.35 by the commissioner. 37.36 (d) The commissioner may deny approval of the additional 38.1 office if the commissioner finds that the state trust 38.2 institution lacks sufficient financial resources to undertake 38.3 the proposed expansion without adversely affecting its safety or 38.4 soundness or that the proposed office would be contrary to the 38.5 public interest. In acting on the notice, the commissioner 38.6 shall consider the views of the appropriate bank supervisory 38.7 agencies. 38.8 Sec. 31. [48A.18] [OUT-OF-STATE TRUST INSTITUTION TRUST 38.9 OFFICES.] 38.10 Subdivision 1. [REQUIREMENT.] An out-of-state trust 38.11 institution may act as a fiduciary in this state or engage in a 38.12 trust business at an office in this state only if it maintains a 38.13 trust office in this state as permitted by this section. 38.14 Subd. 2. [ESTABLISHING AN INTERSTATE TRUST OFFICE.] An 38.15 out-of-state trust institution that does not operate a trust 38.16 office in this state and that meets the requirements of this 38.17 section may acquire and maintain a trust office or establish and 38.18 maintain a new trust office in this state. An out-of-state 38.19 trust institution may not establish a new trust office in this 38.20 state unless a similar institution chartered under the laws of 38.21 this state to act as a fiduciary is permitted to establish a new 38.22 trust office that may engage in activities substantially similar 38.23 to those permitted to trust offices of out-of-state trust 38.24 institutions under subdivision 1 in the state where the 38.25 out-of-state trust institution has its principal office. 38.26 Subd. 3. [NOTICE.] An out-of-state trust institution 38.27 seeking to establish and maintain a new trust office or acquire 38.28 and maintain a trust office in this state according to this 38.29 section shall provide, or cause its home state regulator to 38.30 provide, written notice of the proposed transaction to the 38.31 commissioner on or after the date on which the out-of-state 38.32 trust institution applies to the home state regulator for 38.33 approval to establish and maintain or acquire the trust office. 38.34 The filing of the notice must be preceded or accompanied by a 38.35 copy of the resolution adopted by the board authorizing the 38.36 additional office and the filing fee, if any, prescribed by the 39.1 commissioner. 39.2 Subd. 4. [CONDITIONS FOR APPROVAL.] (a) No trust office of 39.3 an out-of-state trust institution may be acquired or established 39.4 in this state under this section unless: 39.5 (1) the out-of-state trust institution has confirmed in 39.6 writing to the commissioner that for as long as it maintains a 39.7 trust office in this state, it will comply with all applicable 39.8 laws of this state; 39.9 (2) the out-of-state trust institution has provided 39.10 satisfactory evidence to the commissioner that it has complied 39.11 with: 39.12 (i) the applicable requirements of section 303.25; and 39.13 (ii) the applicable requirements of its home state 39.14 regulator for acquiring or establishing and maintaining the 39.15 office; and 39.16 (3) the commissioner, acting within 60 days after receiving 39.17 notice under this section, has certified to the home state 39.18 regulator that the requirements of this section have been met 39.19 and the notice has been approved or, if applicable, that any 39.20 conditions imposed by the commissioner under paragraph (b) have 39.21 been satisfied. 39.22 (b) The out-of-state trust institution may begin business 39.23 at the trust office on the 61st day after the date the 39.24 commissioner receives the notice unless the commissioner 39.25 specifies an earlier or later date, provided, with respect to an 39.26 out-of-state trust institution that is not a depository 39.27 institution and for which the commissioner has conditioned the 39.28 approval on the satisfaction by the out-of-state trust 39.29 institution of any requirement applicable to a state trust 39.30 company under section 48A.02, the institution has satisfied the 39.31 conditions and provided to the commissioner satisfactory 39.32 evidence of that fact. 39.33 (c) The 60-day period of review may be extended by the 39.34 commissioner on a determination that the written notice raises 39.35 issues that require additional information or additional time 39.36 for analysis. If the period of review is extended, the 40.1 out-of-state trust institution may establish the office only on 40.2 prior written approval by the commissioner. 40.3 (d) The commissioner may deny approval of the office if the 40.4 commissioner finds that the out-of-state trust institution lacks 40.5 sufficient financial resources to undertake the proposed 40.6 expansion without adversely affecting its safety or soundness or 40.7 that the proposed office is contrary to the public interest. In 40.8 acting on the notice, the commissioner shall consider the views 40.9 of the appropriate bank supervisory agencies. 40.10 Subd. 5. [ADDITIONAL TRUST OFFICES.] An out-of-state trust 40.11 institution that maintains a trust office in this state under 40.12 this section may establish trust service offices, or 40.13 representative trust offices in this state to the same extent 40.14 that a state trust institution may establish or acquire 40.15 additional offices in this state according to the procedures for 40.16 establishing or acquiring these offices. 40.17 Sec. 32. [48A.19] [OUT-OF-STATE TRUST INSTITUTION 40.18 REPRESENTATIVE TRUST OFFICES.] 40.19 Subdivision 1. [AUTHORIZATION.] (a) Subject to the 40.20 requirements contained in this section, an out-of-state trust 40.21 institution may establish and maintain representative trust 40.22 offices anywhere in this state. 40.23 (b) An out-of-state trust institution may establish or 40.24 acquire and maintain a representative trust office in this 40.25 state. An out-of-state trust institution not maintaining a 40.26 trust office in this state and desiring to establish or acquire 40.27 and maintain a representative trust office shall: 40.28 (1) file a notice on a form prescribed by the commissioner 40.29 stating the name of the out-of-state trust institution and the 40.30 location of the proposed office and satisfactory evidence that 40.31 it is a trust institution; 40.32 (2) furnish a copy of the resolution adopted by the board 40.33 authorizing the representative trust office; and 40.34 (3) pay the filing fee, if any, prescribed by the 40.35 commissioner. 40.36 (c) The out-of-state trust institution may begin business 41.1 at the representative trust office on the 31st day after the 41.2 date the commissioner receives the notice, unless the 41.3 commissioner specifies an earlier or later date. 41.4 Subd. 2. [REVIEW BY COMMISSIONER.] The 30-day period of 41.5 review may be extended by the commissioner on a determination 41.6 that the written notice raises issues that require additional 41.7 information or additional time for analysis. If the period of 41.8 review is extended, the out-of-state trust institution may 41.9 establish the representative trust office only on prior written 41.10 approval by the commissioner. 41.11 Subd. 3. [DISAPPROVAL.] The commissioner may deny approval 41.12 of the representative trust office if the commissioner finds 41.13 that the out-of-state trust institution lacks sufficient 41.14 financial resources to undertake the proposed expansion without 41.15 adversely affecting its safety or soundness or that the proposed 41.16 office would be contrary to the public interests. In acting on 41.17 the notice, the commissioner shall consider the views of the 41.18 appropriate bank supervisory agencies. 41.19 Sec. 33. [48A.20] [SUPERVISION OF OUT-OF-STATE TRUST 41.20 INSTITUTIONS.] 41.21 Subdivision 1. [EXAMINATIONS.] To the extent consistent 41.22 with subdivision 3, the commissioner may make examinations of an 41.23 office established and maintained in this state under this 41.24 chapter by an out-of-state trust institution as the commissioner 41.25 considers necessary to determine whether the office is being 41.26 operated in compliance with the laws of this state and according 41.27 to safe and sound banking practices. Section 46.04 applies to 41.28 these examinations. 41.29 Subd. 2. [PERIODIC REPORTS.] The commissioner may require 41.30 periodic reports regarding an out-of-state trust institution 41.31 that has established and maintained an office in this state 41.32 according to this chapter. The required reports shall be 41.33 provided by the trust institution or by the home state 41.34 regulator. Any reporting requirements prescribed by the 41.35 commissioner under this subdivision shall be: 41.36 (1) consistent with the reporting requirements applicable 42.1 to state trust companies; and 42.2 (2) appropriate to allow the commissioner to carry out the 42.3 commissioner's responsibilities under this chapter. 42.4 Subd. 3. [COOPERATIVE AGREEMENTS.] (a) The commissioner 42.5 may enter into cooperative, coordinating, and 42.6 information-sharing agreements with any other bank supervisory 42.7 agencies or an organization affiliated with or representing one 42.8 or more bank supervisory agencies with respect to the periodic 42.9 examination or other supervision of an office in this state of 42.10 an out-of-state trust institution, or an office of a state trust 42.11 institution in a host state. The commissioner may accept a 42.12 report of examination and report of investigation from a party 42.13 to the agreement in lieu of conducting the commissioner's own 42.14 examination or investigation. 42.15 (b) The commissioner may enter into contracts with any bank 42.16 supervisory agency that has concurrent jurisdiction over a state 42.17 trust institution or an out-of-state trust institution 42.18 maintaining an office in this state to engage the services of 42.19 that agency's examiners at a reasonable rate of compensation or 42.20 to provide the services of the commissioner's examiners to the 42.21 agency at a reasonable rate of compensation. 42.22 (c) The commissioner may enter into joint examinations or 42.23 joint enforcement actions with other bank supervisory agencies 42.24 having concurrent jurisdiction over any office established and 42.25 maintained in this state by an out-of-state trust institution or 42.26 an office established and maintained by a state trust 42.27 institution in any host state. The commissioner may at any time 42.28 take actions independently if the commissioner considers the 42.29 actions to be necessary or appropriate to carry out the 42.30 commissioner's responsibilities under this section or to ensure 42.31 compliance with the laws of this state. In the case of an 42.32 out-of-state trust institution, the commissioner shall recognize 42.33 the exclusive authority of the home state regulator over 42.34 corporate governance matters and the primary responsibility of 42.35 the home state regulator with respect to safety and soundness 42.36 matters. 43.1 Subd. 4. [FEES.] Each out-of-state trust institution that 43.2 maintains one or more offices in this state may be assessed and, 43.3 if assessed, shall pay supervisory and examination fees 43.4 according to the laws of this state and rules of the 43.5 commissioner. The fees may be shared with other bank 43.6 supervisory agencies or an organization affiliated with or 43.7 representing one or more bank supervisory agencies under 43.8 agreements between the parties and the commissioner. 43.9 Sec. 34. [48A.21] [NOTICE OF SUBSEQUENT MERGER, CLOSING.] 43.10 Each out-of-state trust institution that maintains an 43.11 office in this state according to section 48A.18, or the home 43.12 state regulator of the trust institution, shall give at least 30 43.13 days prior written notice or, in the case of an emergency 43.14 transaction, shorter notice as is consistent with applicable 43.15 state or federal law, to the commissioner of: 43.16 (1) a merger, consolidation, or other transaction that 43.17 would cause a change of control with respect to the out-of-state 43.18 trust institution or any bank holding company that controls the 43.19 trust institution, with the result that an application would be 43.20 required to be filed pursuant to the federal Change in Bank 43.21 Control Act of 1978, as amended, United States Code, title 12, 43.22 section 1817(j), or the federal Bank Holding Company Act of 43.23 1956, as amended, United States Code, title 12, section 1841 et 43.24 seq., or any successor statutes; 43.25 (2) a transfer of all or substantially all of the trust 43.26 accounts or trust assets of the out-of-state trust institution 43.27 to another person; or 43.28 (3) the closing or disposition of an office in this state. 43.29 Sec. 35. [48A.22] [ENFORCEMENT.] 43.30 Subdivision 1. [GENERAL AUTHORITY OF COMMISSIONER.] (a) 43.31 Consistent with hearing provisions of sections 46.23 to 46.33, 43.32 if the commissioner finds that: 43.33 (1) an office maintained by an out-of-state trust 43.34 institution in this state is being operated in violation of the 43.35 laws of this state or in an unsafe and unsound manner; or 43.36 (2) a company is engaged in an unauthorized trust activity, 44.1 the commissioner may take any enforcement action the 44.2 commissioner could take if the office or the company were a 44.3 state trust company including, but not limited to, issuing an 44.4 order temporarily or permanently prohibiting the company from 44.5 engaging in a trust business in this state. 44.6 (b) The commissioner may determine by order that an 44.7 out-of-state trust institution engaging in or proposing to 44.8 engage in a trust business in this state does not meet the 44.9 requirements for establishing a representative trust office in 44.10 this state according to section 48A.19, the order is effective 44.11 on the date of issuance or another date the commissioner 44.12 determines. 44.13 Subd. 2. [IMMEDIATE ENFORCEMENT ACTION; SUBSEQUENT 44.14 HEARING.] In cases involving extraordinary circumstances 44.15 requiring immediate action, the commissioner may take any action 44.16 permitted by subdivision 1 without notice or opportunity for 44.17 hearing but shall promptly upon application of the out-of-state 44.18 trust institution afford a subsequent hearing to rescind the 44.19 action taken. The commissioner shall promptly give notice to 44.20 the home state regulator of each enforcement action taken 44.21 against an out-of-state trust institution and, to the extent 44.22 practicable, shall consult and cooperate with the home state 44.23 regulator in pursuing and resolving the enforcement action. 44.24 Sec. 36. Minnesota Statutes 1996, section 50.085, 44.25 subdivision 14, is amended to read: 44.26 Subd. 14. [TRUST POWERS.] Upon application to and approval 44.27 by the commissioner of commerce, a savings bank may act as 44.28 trustee, executor, administrator, personal representative, 44.29 conservator, custodian, guardian, or in any other fiduciary 44.30 capacity in which state banks, trust companies, or other 44.31 corporations are permitted to act, and receive reasonable 44.32 compensation for it.A savings bank that has complied with44.33sections 48.36 to 48.43 and 48.475, and holds a certificate as44.34provided in section 48.37, may exercise the powers and44.35privileges set forth in sections 48.38, 48.475, 48.84, 48.841,44.3648.846, and 48.86.A savings bank that has qualified and 45.1 obtained a certificate, as provided insections 48.36 to45.248.43section 48.37, may use in its corporate name or title, in 45.3 addition to the words "savings bank" or other words permitted by 45.4 law, the words "trust" or "trust company," and may display and 45.5 make use of signs, symbols, tokens, letterheads, cards, 45.6 circulars, and advertising stating or indicating that it is 45.7 authorized to transact the business authorized by those 45.8 sections, and a savings bank using the words "trust" or "trust 45.9 company" is not required to use the word "state" in its 45.10 corporate name. A savings bank may not invest, pursuant to 45.11 section 50.1465, in a corporation that engages in activities 45.12 described in this subdivision, without first obtaining the 45.13 approval of the commissioner of commerce. 45.14 Sec. 37. Minnesota Statutes 1997 Supplement, section 45.15 80A.28, subdivision 1, is amended to read: 45.16 Subdivision 1. (a) There shall be a filing fee of $100 for 45.17 every application for registration or notice filing. There 45.18 shall be an additional fee of one-tenth of one percent of the 45.19 maximum aggregate offering price at which the securities are to 45.20 be offered in this state, and the maximum combined fees shall 45.21 not exceed $300. 45.22 (b) When an application for registration is withdrawn 45.23 before the effective date or a preeffective stop order is 45.24 entered under section 80A.13, subdivision 1, all but the $100 45.25 filing fee shall be returned. If an application to register 45.26 securities is denied, the total of all fees received shall be 45.27 retained. 45.28 (c) Where a filing is made in connection with a federal 45.29 covered security under section 18(b)(2) of the Securities Act of 45.30 1933, there is a fee of $100 for every initial filing.There is45.31an additional fee of 1/20 of one percent of the maximum45.32aggregate offering price at which the securities are to be45.33offered in this state. There is no maximum fee for securities45.34filings made according to this section.If the filing is made 45.35 in connection with redeemable securities issued by an open end 45.36 management company or unit investment trust, as defined in the 46.1 Investment Company Act of 1940, there is an additional fee of 46.2 1/20 of one percent of the maximum aggregate offering price at 46.3 which the securities are to be offered in this state. If the 46.4 filing is made in connection with redeemable securities issued 46.5 by such a company or trust, there is no maximum fee for 46.6 securities filings made according to this clause. If the filing 46.7 is made in connection with any other federal covered security 46.8 under Section 18(b)(2) of the Securities Act of 1933, there is 46.9 an additional fee of one-tenth of one percent of the maximum 46.10 aggregate offering price at which the securities are to be 46.11 offered in this state, and the combined fees shall not exceed 46.12 $300. 46.13 Sec. 38. Minnesota Statutes 1996, section 303.25, 46.14 subdivision 3, is amended to read: 46.15 Subd. 3. [BOND MUST BE FILED.] Before accepting 46.16 appointment or acting as executor, administrator, trustee, 46.17 guardian, or conservator, every foreign trust association shall 46.18 file a bond with a court of competent jurisdiction in an amount 46.19 as the court directs, with sufficient sureties, conditioned upon 46.20 the faithful discharge of its duties as executor, administrator, 46.21 trustee, guardian, or conservator, or, in lieu of the bond, 46.22 shall deposit securities with the state treasurer in the same 46.23 manner and in the same amount as would be required under section 46.2448.6748A.03, subdivision 2, of a trust company organized under 46.25 the laws of this state. This deposit shall be maintained until 46.26 the foreign trust association shall cease to act as an executor, 46.27 administrator, trustee, guardian, or conservator under this 46.28 section. However, except as otherwise ordered by a court of 46.29 competent jurisdiction, the requirements of this subdivision do 46.30 not apply to a trustee with respect to a trust created otherwise 46.31 than by will if the trust instrument requests or directs that a 46.32 bond need not be required of the trustee. 46.33 Sec. 39. Minnesota Statutes 1996, section 525.551, 46.34 subdivision 6, is amended to read: 46.35 Subd. 6. [BOND.] Upon the filing of a bond by the guardian 46.36 or conservator of an estate in an amount the court may direct 47.1 and an oath according to law, or upon the filing of an 47.2 acceptance of the trust pursuant to section48.7948A.08, 47.3 subdivision 4, letters of guardianship or conservatorship shall 47.4 issue. If there is no personal property, the court may waive 47.5 the filing of a bond, but if the guardian or conservator 47.6 receives or becomes entitled to any property of the ward or 47.7 conservatee the guardian or conservator shall immediately file a 47.8 report thereof and a bond in an amount the court may direct. In 47.9 case of breach of a condition of the bond an action thereon may 47.10 be prosecuted by leave of the court by any interested person or 47.11 by the court on its own motion. 47.12 Sec. 40. Minnesota Statutes 1996, section 525.56, 47.13 subdivision 4, is amended to read: 47.14 Subd. 4. [DUTIES OF GUARDIAN OR CONSERVATOR OF THE 47.15 ESTATE.] The court may appoint a guardian of the estate if it 47.16 determines that all the powers and duties listed in this 47.17 subdivision are needed to provide for the needs of the 47.18 incapacitated person. The court may appoint a conservator of 47.19 the estate if it determines that a conservator is necessary to 47.20 provide for the needs of the incapacitated person through the 47.21 exercise of some, but not all, of the powers and duties listed 47.22 in this subdivision. The duties and powers of a guardian or 47.23 those which the court may grant to a conservator include, but 47.24 are not limited to: 47.25 (1) The duty to pay the reasonable charges for the support, 47.26 maintenance, and education of the ward or conservatee in a 47.27 manner suitable to the ward's or conservatee's station in life 47.28 and the value of the estate. Nothing herein contained shall 47.29 release parents from obligations imposed by law for the support, 47.30 maintenance, and education of their children. The guardian or 47.31 conservator has no duty to pay for these requirements out of 47.32 personal funds. Wherever possible and appropriate, the guardian 47.33 or conservator should meet these requirements through 47.34 governmental benefits or services to which the ward or 47.35 conservatee is entitled, rather than from the ward's or 47.36 conservatee's estate. Failure to satisfy the needs and 48.1 requirements of this clause shall be grounds for removal, but 48.2 the guardian or conservator shall have no personal or monetary 48.3 liability; 48.4 (2) The duty to pay out of the ward's or conservatee's 48.5 estate all just and lawful debts of the ward or conservatee and 48.6 the reasonable charges incurred for the support, maintenance, 48.7 and education of the ward's or conservatee's spouse and 48.8 dependent children and, upon order of the court, pay such sum as 48.9 the court may fix as reasonable for the support of any person 48.10 unable to earn a livelihood who is legally entitled to support 48.11 from the ward or conservatee; 48.12 (3) The duty to possess and manage the estate, collect all 48.13 debts and claims in favor of the ward or conservatee, or, with 48.14 the approval of the court, compromise them, institute suit on 48.15 behalf of the ward or conservatee and represent the ward or 48.16 conservatee in any court proceedings, and invest all funds not 48.17 currently needed for the debts and charges named in clauses (1) 48.18 and (2) and the management of the estate, in accordance with the 48.19 provisions of sections48.8448A.07, subdivision 6, and 48.20 501B.151, or as otherwise ordered by the court. The standard of 48.21 a fiduciary shall be applicable to all investments by a guardian 48.22 or conservator. A guardian or conservator shall also have the 48.23 power to purchase certain contracts of insurance as provided in 48.24 section 50.14, subdivision 14, clause (b); 48.25 (4) Where a ward or conservatee has inherited an undivided 48.26 interest in real estate, the court, on a showing that it is for 48.27 the best interest of the ward or conservatee, may authorize an 48.28 exchange or sale of the ward's or conservatee's interest or a 48.29 purchase by the ward or conservatee of any interest other heirs 48.30 may have in the real estate. 48.31 Sec. 41. [REPEALER.] 48.32 Minnesota Statutes 1996, sections 48.38; 48.475; 48.65; 48.33 48.66; 48.67; 48.68; 48.69; 48.70; 48.71; 48.72; 48.73; 48.75; 48.34 48.76; 48.77; 48.78; 48.79; 48.80; 48.81; 48.82; 48.83; 48.84; 48.35 48.841; 48.845; 48.846; 48.85; and 48.86; and Minnesota Statutes 48.36 1997 Supplement, section 48.476, are repealed.