Section 17.08. Funds awaiting investment or distribution.

 

(1)   General. Funds held in a fiduciary capacity by an association awaiting investment or distribution may not be held uninvested or undistributed any longer than is reasonable for the proper management of the account.

(2)   Use by association in regular business. Funds held in trust by an association, including managing agency accounts, awaiting investment or distribution may, unless prohibited by the instrument creating the trust or by local law, be deposited in other departments of the association, except the association shall first set aside under control of the trust department as collateral security:

(a) Direct obligations of the United States, or other obligations fully guaranteed by the United States as to principal and interest;

(b) Readily marketable securities of the classes in which state chartered corporate fiduciaries may invest trust funds; or

(c) Other readily marketable securities as the division may determine.

(3)   Contingent lien. An association shall ensure that in the event of its failure, the owners of the funds held in trust for investment under this chapter shall have a lien on the bonds or other securities set apart under sub. (2) in addition to their claim against the estate of the association.

(4)   Amount of collateral. Collateral securities or securities substituted for collateral securities as collateral shall at all times be at least equal in face value to the amount of trust funds deposited under sub. (2) , but the security is not required to the extent that the funds so deposited are insured by the federal savings and loan insurance corporation.

(5)   Productivity. Any funds held by an association as fiduciary awaiting investment or distribution and deposited in other departments of the association shall be made productive.

History: Cr. Register, June, 1989, No. 402 , eff. 7-1-89.

Note

This section parallels 12 CFR 550.8 and 12 USC 1464 (n) (5). Microsoft Windows NT 6.1.7601 Service Pack 1