Michigan Laws 555.112 – Common trust funds; additional investments
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Terms Used In Michigan Laws 555.112
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Executor: A male person named in a will to carry out the decedent
- Fiduciary: A trustee, executor, or administrator.
- Fiduciary: means a financial institution or other person acting in the capacity of guardian, conservator, personal representative, or trustee, either solely or together with others, or custodian under a uniform gift or transfer to minors act of any state. See Michigan Laws 555.101
- Financial institution: means any of the following:
(i) A state bank, national bank, state or federally chartered savings and loan association or savings bank that is authorized to act in a fiduciary capacity in this state. See Michigan Laws 555.101Fund: means a common trust fund or a collective investment fund. See Michigan Laws 555.101 Guardian: A person legally empowered and charged with the duty of taking care of and managing the property of another person who because of age, intellect, or health, is incapable of managing his (her) own affairs. Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period. Plan: means the written plan for a fund described in section 4. See Michigan Laws 555.101 state: when applied to the different parts of the United States, shall be construed to extend to and include the District of Columbia and the several territories belonging to the United States; and the words "United States" shall be construed to include the district and territories. See Michigan Laws 8.3o Statute: A law passed by a legislature. Trustee: A person or institution holding and administering property in trust. United States: shall be construed to include the district and territories. See Michigan Laws 8.3o
(1) In addition to investing assets in a fund, a financial institution may invest assets that it holds as fiduciary in any of the following, to the extent not prohibited by applicable law:
(a) In any of the following loans or obligations, if the financial institution’s only interest in the loans or obligations is its capacity as fiduciary:
(i) A single real estate loan, a direct obligation of the United States, or an obligation fully guaranteed by the United States or a single fixed amount security, obligation, or other property, either real, personal, or mixed, of a single issuer.
(ii) A variable amount note of a borrower of prime credit, if the financial institution uses the note solely for investment of funds held in its fiduciary accounts.
(b) In a fund maintained by the financial institution for the collective investment of cash balances received or held by a financial institution in its capacity as trustee, personal representative, executor, administrator, guardian, or custodian under a uniform gifts or transfers to minors act of any state that the financial institution considers too small to be invested separately to advantage. The total assets in a fund described in this subdivision shall not exceed $1,000,000.00 and the number of participating accounts shall not exceed 100.
(c) In any investment specifically authorized by the instrument creating the fiduciary account or in a court order, in the case of trusts created by a corporation, including its affiliates and subsidiaries, or by several individual settlors who are closely related.
(d) In any collective investment authorized by applicable law, including, but not limited to, an investment under a preneed funeral statute of any state.
(e) In any other manner described by the financial institution in a written plan approved by the financial institution’s state or federal regulator. In order to obtain a special exemption, a financial institution shall submit to its regulator a written plan that sets forth all of the following:
(i) The reason that the proposed fund requires a special exemption.
(ii) The provisions of the proposed fund that are inconsistent with this act.
(iii) The provisions of this act for which the financial institution seeks an exemption.
(iv) The manner in which the proposed fund addresses the rights and interests of the participating accounts.
(2) For purposes of this section, a financial institution acts as a fiduciary if the financial institution acts as any of the following:
(a) A trustee, personal representative, executor, administrator, registrar of stocks and bonds, transfer agent, guardian, assignee, receiver, or custodian under a uniform gifts or transfers to minors act of any state.
(b) An investment adviser, if the financial institution receives a fee for its investment advice.
(c) In any capacity in which the financial institution possesses investment discretion on behalf of another.
(d) In any similar capacity that a federal banking agency having authority over the financial institution may authorize from time to time.