2013 Kentucky Revised Statutes CHAPTER 386 - ADMINISTRATION OF TRUSTS -- LEGAL INVESTMENTS -- UNIFORM PRINCIPAL AND INCOME ACT 386.020 Authorized investments of trust funds -- Fiduciary to account for profits.
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386.020 Authorized investments of trust funds -- Fiduciary to account for
profits.
(1)
Any fiduciary holding funds for loan or investment may invest them in:
(a) Bonds or other interest-bearing obligations of the federal government;
(b) Bonds, state warrants, and other interest-bearing obligations of this state;
(c) Obligations issued separately or collectively by or for federal land banks,
federal intermediate credit banks, and banks for cooperatives under the
Act of Congress known as the Farm Credit Act of 1971, 85 Stat. 583, 12
U.S.C. sec. 2001 and amendments thereto;
(d) Notes and bonds secured by mortgage or trust deed insured by the
federal housing administrator, obligations issued or insured by the federal
housing administrator, and securities issued by national mortgage
associations;
(e) Obligations representing loans and advances of credit that are eligible for
credit insurance by the federal housing administrator, and the fiduciary
may obtain such insurance;
(f) Loans secured by real property or leasehold, that the federal housing
administrator insures or makes a commitment to insure, and the fiduciary
may obtain such insurance;
(g) Real estate mortgage notes, bonds, and other interest-bearing or
dividend-paying securities, including securities of any open-end or
closed-end management type investment company or investment trust
registered under the Federal Investment Company Act of 1940 or units of
common trust funds managed by the fiduciary, which would be regarded
by prudent businessmen as a safe investment. The fact that the fiduciary
is providing services to the foregoing investment company or trust as
investment advisor, custodian, transfer agent, registrar, or otherwise shall
not preclude the fiduciary from investing in the securities of such
investment or trust;
(h) Real estate, after obtaining the approval of the District Court for such
investment;
(i) Life insurance, endowment, and annuity contracts issued by legal reserve
companies authorized to do business in this state, after obtaining the
approval of the District Court for such investment. Said fiduciary may
select any optional settlement provided in a policy maturing by death or
as an endowment;
(j) Notes, other interest-bearing obligations, and purchases of participations
in such instruments, that are guaranteed in whole or in part by the United
States of America or by any agency or instrumentality thereof;
(k) Certificates of deposit and savings accounts of any state or national bank
whose deposits are insured by the Federal Deposit Insurance Corporation
and whose main office is in this state, including itself, if such fiduciary is a
bank. Any portion of such investments that is not insured by the Federal
Deposit Insurance Corporation shall be fully secured by:
1.
An irrevocable letter of credit issued by the United States of America
(2)
(3)
or by an agency or instrumentality thereof;
2.
A pledge of securities named in this subsection as collateral;
3.
A surety bond; or
4.
A combination of such irrevocable letters of credit, securities, and
surety bonds; and
(l) United States government securities or United States government agency
securities, the payment of the principal and interest on which the full faith
and credit of the United States is pledged, said investments being made
under the terms of a repurchase agreement between the fiduciary and
any state or national bank whose main office is in this state, including
itself, if such fiduciary is a bank.
Fiduciaries holding funds for loan or investment may make loans with the
securities named in subsection (1) as collateral.
The fiduciary shall account for all interest or profit received.
Effective:July 15, 2002
History: Amended 2002 Ky. Acts ch. 157, sec. 1, effective July 15, 2002. -Amended 1990 Ky. Acts ch. 450, sec. 1, effective July 13, 1990. -- Amended
1986 Ky. Acts ch. 391, sec. 1, effective July 15, 1986. -- Amended 1980 Ky.
Acts ch. 134, sec. 1, effective July 15, 1980. -- Amended 1976 (1st Extra. Sess.)
Ky. Acts ch. 14, sec. 325, effective January 1, 1978. -- Amended 1976 Ky. Acts
ch. 107, sec. 3. -- Amended 1970 Ky. Acts ch. 267, sec. 1. -- Amended 1962 Ky.
Acts ch. 133, sec. 1.-- Amended 1960 Ky. Acts ch. 155, sec. 1. -- Amended
1954 Ky. Acts ch. 52, sec. 1. -- Amended 1950 Ky. Acts ch. 171, sec. 1. -Amended 1944 Ky. Acts ch. 111, sec. 1. -- Recodified 1942 Ky. Acts ch. 208,
sec. 1,
effective
October
1,
1942,
from
Ky.
Stat.
secs. 4706, 4706a, 4706-6, 4706-7.
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