SCS CSHB 157(JUD): "An Act relating to trust companies and providers of fiduciary services; amending Rules 6 and 12, Alaska Rules of Civil Procedure, Rule 40, Alaska Rules of Criminal Procedure, Rules 204, 403, 502, 602, and 611, Alaska Rules of Appellate Procedure, and Rules 7.2 and 7.3, Alaska Rules of Professional Conduct; and providing for an effective date."
00 SENATE CS FOR CS FOR HOUSE BILL NO. 157(JUD) 01 "An Act relating to trust companies and providers of fiduciary services; amending Rules 02 6 and 12, Alaska Rules of Civil Procedure, Rule 40, Alaska Rules of Criminal Procedure, 03 Rules 204, 403, 502, 602, and 611, Alaska Rules of Appellate Procedure, and Rules 7.2 04 and 7.3, Alaska Rules of Professional Conduct; and providing for an effective date." 05 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 06 * Section 1. AS 06.05.235(g) is amended to read: 07 (g) For the purpose of this section and AS 06.05.570, a trust company 08 organized under AS 06.26 [AS 06.25] that is engaged in the business of banking shall 09 be considered a state bank. 10 * Sec. 2. AS 06 is amended by adding a new chapter to read: 11 Chapter 26. Providers of Fiduciary Services. 12 Article 1. General Authority. 13 Sec. 06.26.010. Persons authorized to act as fiduciaries. (a) 14 Notwithstanding other provisions of law and except as provided in AS 06.26.020, a
01 person may not act as a fiduciary in this state unless the person is 02 (1) a trust company organized under this chapter; 03 (2) a private trust company that has received an exemption under 04 AS 06.26.200; 05 (3) a state financial institution; 06 (4) a national bank having its principal office in this state and 07 authorized by the United States Comptroller of the Currency to act as a fiduciary; 08 (5) a federally chartered savings association having its principal office 09 in this state and authorized by its federal chartering authority to act as a fiduciary; 10 (6) an international bank that has a branch bank in this state established 11 or maintained under AS 06.05.550; in this paragraph, "international bank" has the 12 meaning given in AS 06.05.990; 13 (7) an interstate national bank with a branch bank in this state 14 established or maintained under AS 06.05.550; in this paragraph, "interstate national 15 bank" means a national bank whose principal office, as designated in the bank's 16 articles of incorporation, is not located in this state; 17 (8) an entity that 18 (A) is organized under the laws of a state of the United States 19 other than this state; 20 (B) holds a charter, license, certificate, or other type of 21 authorization from this or another state of the United States to engage in 22 banking; and 23 (C) has a branch bank located in this state established or 24 maintained under AS 06.05.550; 25 (9) an interstate state trust company or international trust company 26 with a trust office authorized by the department under AS 06.26.810 - 06.26.895; 27 (10) a trustee of only charitable trusts, does not offer fiduciary services 28 to the general public with regard to noncharitable trusts, and observes the requirements 29 applicable to trustees under AS 13.36.225 - 13.36.290 (Alaska Uniform Prudent 30 Investor Act); or 31 (11) a federally chartered credit union having its principal office in this
01 state and authorized by the National Credit Union Administration to act as a fiduciary. 02 (b) In this section, "branch bank" has the meaning given in 06.05.990. 03 Sec. 06.26.020. Exemptions. (a) Notwithstanding any other provision of this 04 chapter, a person does not act as a fiduciary under this chapter if the person 05 (1) is licensed to practice law in this state, the person is acting within 06 the scope of the license, and the person and any law firm of the person are not trustees 07 of more trusts than the number established for the person and law firm by the 08 department by regulation or order; in this paragraph, "law firm" means a partnership, a 09 professional corporation organized under AS 10.45, or another association organized 10 for the practice of law and in which the person practices law; 11 (2) acts as trustee under a deed of trust delivered only as security for 12 the payment of money or for the performance of another act; 13 (3) receives and distributes on behalf of a principal rents and proceeds 14 of sales as a real estate broker or other licensee under AS 08.88; 15 (4) engages in securities business activity or investment advisory 16 business activity as a registered broker-dealer, a broker-dealer agent, a state 17 investment adviser, or an investment adviser representative, or as a federal covered 18 adviser who has made a notice filing under AS 45.55.040(h), the person is acting 19 within the scope of the person's registration or notice filing, and the activity is 20 regulated by the department under AS 45.55 or by the United States Securities and 21 Exchange Commission; in this paragraph, "agent," "broker-dealer," "federal covered 22 adviser," "investment adviser representative," "investment advisory business," 23 "securities business," and "state investment adviser" have the meanings given in 24 AS 45.55.990; 25 (5) engages in the sale and administration of an insurance product as 26 an insurance company licensed under AS 21 or an insurance producer licensed under 27 AS 21 and is acting within the scope of that license; 28 (6) handles escrow transactions and is a title insurance company that 29 has a certificate of authority issued under AS 21.09, a title insurance limited producer 30 that is licensed as required by AS 21.66.270, or an employee of the title insurance 31 company or title insurance producer when acting in the scope of the employee's
01 employment; in this paragraph, 02 (A) "escrow transaction" has the meaning given in 03 AS 34.80.090; 04 (B) "title insurance company" has the meaning given in 05 AS 21.66.480; 06 (C) "title insurance limited producer" has the meaning given in 07 AS 21.66.480; 08 (7) is a cemetery association organized and acting under AS 10.30; 09 (8) is a trustee for a voting trust under AS 10.06 and is acting in that 10 capacity; 11 (9) has a certified public accountant certificate issued under AS 08.04, 12 the person is acting within the scope of the certificate, and the person and any 13 accounting firm of the person are not trustees of more trusts than the number 14 established for the person and accounting firm by the department by regulation or 15 order; in this paragraph, "accounting firm" means a partnership, a professional 16 corporation organized under AS 10.45, or another association organized for the 17 practice of public accounting and in which the person practices public accounting; 18 (10) holds real property in trust for the primary purpose of subdivision, 19 development, or sale or to facilitate a business transaction with respect to the real 20 property; 21 (11) serves as a trustee of a trust created by the person's family 22 members; 23 (12) holds money or other assets as a homeowners' association or 24 similar organization to pay maintenance and other related costs for commonly owned 25 property; in this paragraph, "homeowners' association" includes an association of 26 apartment owners under AS 34.07.450 and a unit owners' association or master 27 association under AS 34.08.990; 28 (13) holds money or other assets in connection with the collection of 29 debts or payments on loans by a person acting solely as the agent or representative at 30 the sole direction of the person to whom the debt or payment is owed, including 31 engaging in the business of an escrow agent;
01 (14) acts as a conservator if the person is appointed by a court of this 02 or another state or is qualified to act as a conservator under AS 13.26.320; 03 (15) acts as a personal representative if the person is appointed a 04 personal representative by a court of this or another state or is qualified to act as a 05 personal representative under AS 13.21.035; 06 (16) acts as a guardian or receiver if the person is appointed as a 07 guardian or receiver by a court of this or another state; 08 (17) is a business partner acting with regard to the business, or a co- 09 owner of property acting with regard to the co-owned property; 10 (18) serves as a trustee of one or more trusts in which the settlor is not 11 a family member of the person, except that the person may not at any one time serve 12 as a trustee for trusts that cumulatively have more than 10 different settlors; however, 13 the department may change by regulation or order the maximum number of settlors 14 allowed for this exemption; in this paragraph, a husband and wife who create a joint 15 trust are considered to be one settlor. 16 (b) When establishing the number of trusts that are allowed for an exemption 17 under (a)(1) or (9) of this section or when changing the maximum number of settlors 18 that are allowed for an exemption under (a)(18) of this section, the department shall 19 consider the protection of the public, the effect on efficient delivery of trust services at 20 a reasonable cost, and the likelihood that the particular exemption can make the trust 21 services available to the persons who need the service. 22 (c) In addition to the exemptions identified in (a) of this section, the 23 department may by regulation or order grant an exemption to a person if the person 24 demonstrates good cause for needing the exemption and the department determines 25 that the exemption would not conflict with public order or convenience. 26 (d) In addition to any other requirements established for the exemption, to 27 maintain an exemption under this section, a person who is exempt under (a) or (c) of 28 this section may not offer fiduciary services to the general public. 29 Sec. 06.26.030. Location of operation. (a) A trust company may act as a 30 fiduciary in this state, another state, or a foreign country, subject to complying with 31 applicable laws of the state or foreign country, at an office or branch established and
01 maintained under this chapter. 02 (b) A trust company may conduct any activities at an office outside this state 03 that are permissible for a trust company chartered by the host state, except to the 04 extent those activities are expressly prohibited by the laws of this state or by a 05 regulation or order of the department applicable to the trust company. 06 Article 2. Name, Powers, Organization, and Capitalization. 07 Sec. 06.26.040. Name of trust company. (a) A person may not use the 08 words "trust" or "trust company" or any other words in a manner that could reasonably 09 be expected to convey the impression that the person is acting as a fiduciary unless the 10 person is authorized to act as a fiduciary under AS 06.26.010. 11 (b) This section does not prohibit the use of the words "trust" or "trust 12 company" in the name of a corporation that is in existence as of the effective date of 13 this Act and that is not subject to this chapter if the corporation was originally 14 organized under the laws of this state and has not, since the date of its original 15 organization, amended or restated its articles of incorporation to delete from its name 16 the words "trust" or "trust company." 17 Sec. 06.26.050. Powers of trust company. (a) A trust company may perform 18 any act as a fiduciary that a state financial institution, or a national bank exclusively 19 exercising trust powers, may perform, including 20 (1) acting as trustee under a written agreement; 21 (2) receiving money and other property as trustee for investment in 22 real or personal property; 23 (3) acting as a trustee and performing the fiduciary duties committed 24 or transferred to it by a court; 25 (4) receiving money or other assets under AS 06.35; 26 (5) acting as an executor, an administrator, or a trustee of the estate of 27 a deceased person; 28 (6) acting as a custodian, guardian, conservator, or trustee for a minor 29 or an incapacitated person; 30 (7) acting as a successor fiduciary to a depository; 31 (8) receiving for safekeeping any type of personal property;
01 (9) acting as a custodian, an assignee, a transfer agent, an escrow 02 agent, a registrar, or a receiver; 03 (10) acting as an investment adviser, an agent, or an attorney-in-fact in 04 any agreed upon capacity; 05 (11) exercising additional powers expressly authorized by a regulation 06 adopted under this chapter; and 07 (12) exercising an incidental power that is reasonably necessary to 08 enable it to fully exercise the powers expressly conferred according to commonly 09 accepted fiduciary customs and usage. 10 (b) A trust company may exercise the powers of a business incorporated under 11 the laws of this state that are reasonably necessary to enable the exercise of its specific 12 powers under this chapter. 13 (c) A trust company may contribute to community solicitations, or to 14 charitable, philanthropic, or benevolent instrumentalities that operate to promote 15 public welfare, amounts that its board considers appropriate and in the interests of the 16 trust company. 17 (d) Subject to AS 06.26.370, a trust company may deposit trust money or 18 other assets with itself. 19 (e) Subject to the approval of the department and to being insured by the 20 Federal Deposit Insurance Corporation or its successor, a trust company may accept 21 deposits from the public. 22 (f) A trust company organized under this chapter may apply for a certificate of 23 authority under AS 06.05. 24 (g) A trust company organized under this chapter with a certificate of 25 authority issued under AS 06.05 may exercise all powers granted to it under AS 06.05 26 to the extent the powers do not conflict with this chapter. A trust company with a 27 certificate of authority issued under AS 06.05 is subject to all of the provisions of 28 AS 06.05. In case of a conflict between the provisions of this chapter and AS 06.05, 29 the provisions of this chapter apply. 30 (h) In (a) of this section, "national bank exclusively exercising trust powers" 31 means a person issued a charter by the United States Comptroller of the Currency if
01 the charter confers only trust powers. 02 Sec. 06.26.060. Organizers. One or more persons may organize a trust 03 company. 04 Sec. 06.26.070. Incorporation. (a) A trust company shall be incorporated 05 under AS 10.06. 06 (b) In addition to the items required under AS 10.06.208 to be included in 07 articles of incorporation, the articles of incorporation of a trust company must specify 08 (1) the judicial district where the trust company will be located and the 09 community where the trust company will locate its principal place of business; 10 (2) the amount of the trust company's stock, which must be divided 11 into shares having a par value of not less than $1 each; 12 (3) that there will be at least five but not more than 25 directors; 13 (4) the period for which the trust company is organized, whether 14 limited or perpetual; 15 (5) the name by which the trust company will be known, which must 16 contain the words "trust company" as a part of the name; and 17 (6) a declaration that each incorporator will, if elected, accept the 18 responsibilities and faithfully discharge the duties of a director. 19 Sec. 06.26.080. Amendment of articles or bylaws. (a) A trust company may 20 amend its articles of incorporation or bylaws in a manner consistent with its articles, 21 its bylaws, AS 10.06, and this chapter by a vote of its shareholders representing at 22 least a majority of the capital at a regular meeting or at a special meeting called for 23 that purpose. The trust company shall file a written notice of an amendment with the 24 department. 25 (b) The department has 60 days from the date that the department receives a 26 notice under (a) of this section to review the amendment, and the amendment becomes 27 effective on the 61st day after the department receives the notice unless the department 28 specifies a different date. The department may extend the 60-day period of review if 29 the department determines that the notice raises significant issues that require 30 additional information or if the department needs additional time for analysis. If the 31 60-day period of review is extended, the amendment becomes effective only when the
01 department approves the amendment in writing. 02 Sec. 06.26.085. Certificate of authority required. A person may not act as a 03 trust company until a certificate of authority is received from the department. 04 Sec. 06.26.090. Application for certificate of authority. (a) An application 05 for a certificate of authority shall be made in the form required by the department and 06 must be supported by the information, data, records, and opinions of counsel required 07 by the department. The application must be accompanied by all fees and deposits 08 required by this chapter. 09 (b) The department may grant a certificate of authority only if the department 10 receives evidence from the applicant that the department determines demonstrates that 11 the establishment of the proposed trust company will serve public convenience and 12 well-being. The evidence must address the following factors: 13 (1) the market to be served; 14 (2) whether the proposed organizational structure, capital structure, 15 and amount of initial capitalization are adequate for the proposed trust company and 16 its location; 17 (3) whether the anticipated volume and nature of the proposed trust 18 company indicates a reasonable probability of success and profitability based on the 19 market sought to be served; 20 (4) whether, as a group, the proposed officers, directors, and 21 employees have sufficient fiduciary experience, ability, standing, competence, 22 trustworthiness, and integrity to justify a belief that the proposed trust company will 23 operate in compliance with the law and that success of the proposed trust company is 24 probable; 25 (5) whether each principal shareholder has sufficient experience, 26 ability, standing, competence, trustworthiness, and integrity to justify a belief that the 27 proposed trust company will be free from improper or unlawful influence or 28 interference with respect to the trust company's operation in compliance with the law; 29 and 30 (6) whether the persons organizing the trust company are acting in 31 good faith.
01 (c) The applicant for a certificate of authority bears the burden of establishing 02 that public convenience and well-being will be served by the establishment of the trust 03 company. The failure of an applicant to furnish required information, data, opinions 04 of counsel, other material, the required fee, or a required deposit is considered an 05 abandonment of the application. 06 (d) An applicant shall pay under AS 06.01.010 the investigation expenses 07 incurred by the department in processing an application for a certificate of authority. 08 When submitting an application to the department, the applicant shall pay the 09 department $2,000 as an advance payment of the investigation expenses incurred by 10 the department. If the investigation expenses incurred by the department are less than 11 $2,000, the department shall promptly refund the excess to the applicant. If the 12 investigation expenses incurred by the department are greater than $2,000, the 13 department may obtain reimbursement from the applicant. 14 (e) The department shall determine whether all of the applicable requirements 15 of this section have been satisfied and shall enter an order granting or denying the 16 certificate of authority. The department may deny the application if the department 17 determines that the requirements of this chapter have not been met. The department 18 may set conditions on the certificate of authority and shall include any conditions in 19 the order granting the certificate of authority. 20 (f) If a protest of the application is not filed with the department on or before 21 the 15th day after the last date that the notice is published under AS 06.26.100, the 22 department may immediately determine whether the application meets the 23 requirements of this section based on the application and investigation. 24 Sec. 06.26.100. Department notices regarding application. (a) The 25 department shall notify the organizers of a proposed trust company when the 26 application under AS 06.26.090 is complete and accepted for filing and all required 27 fees and deposits have been paid. Promptly after notification, the organizers shall 28 publish in a form specified by the department notice of the filing of the application in 29 a newspaper of general circulation published in the community proposed as the trust 30 company's principal place of business. If a newspaper of general circulation is not 31 published in the community, the organizers shall publish the notice in a newspaper of
01 general circulation near the community. The department may require the organizers to 02 publish the notice at other locations reasonably necessary to solicit the views of 03 potentially affected persons. The notice must include a solicitation of comments and 04 protests. 05 (b) To prove that the publication required by (a) of this section has been 06 accomplished, the organizers shall file with the department an affidavit of publication 07 from the newspaper in which the notice was published. 08 Sec. 06.26.110. Issuance of certificate of authority; required operation. 09 (a) The department may not deliver a certificate of authority to a person to act as a 10 trust company until the person has 11 (1) received cash or marketable securities in at least the full amount of 12 the capital required under AS 06.26.120 from subscriptions for the issuance of shares; 13 (2) elected or qualified the initial officers and directors named in the 14 application for the certificate of authority or other officers and directors approved by 15 the department; and 16 (3) complied with all other requirements of this chapter related to the 17 organization of a trust company. 18 (b) A person who receives a certificate of authority, including a certificate of 19 authority with conditions, shall open a home office and begin providing fiduciary 20 services within six months after the date that the person receives the certificate of 21 authority or by the end of any extension of the six-month period allowed by the 22 department. If the person does not open the home office or begin providing fiduciary 23 services within the six months or by the end of any extension, the department shall 24 revoke the certificate of authority. 25 Sec. 06.26.120. Required capital; change in outstanding capital and 26 surplus. (a) A trust company may not act as a fiduciary unless the trust company has 27 paid-in capital in an amount acceptable to the department, but not less than $400,000, 28 and paid-in surplus equal to 20 percent of paid-in capital. The trust company shall 29 hold its unimpaired capital as security for the faithful discharge of the fiduciary duties 30 undertaken by the trust company and for the claims of creditors. 31 (b) The department may by order require or permit adjustment to capital for a
01 proposed or existing trust company if the department finds the condition and 02 operations of an existing trust company or the proposed scope or type of operations of 03 a proposed trust company requires adjustment to capital to protect the safety and 04 soundness of the trust company. The safety and soundness factors to be considered by 05 the department in the exercise of its discretion to adjust capital include 06 (1) the nature and type of business conducted; 07 (2) the nature and degree of liquidity of the assets held by the trust 08 company other than trust assets; 09 (3) the amount of fiduciary assets being managed; 10 (4) the type of fiduciary assets held and the depository of those assets; 11 (5) the complexity of the fiduciary duties and degree of discretion 12 undertaken; 13 (6) the competence and experience of management; 14 (7) the extent and adequacy of internal controls; 15 (8) the presence or absence of annual unqualified audits by an 16 independent certified public accountant; 17 (9) the reasonableness of the trust company's plans for retaining or 18 acquiring additional capital; and 19 (10) the existence and adequacy of insurance held by the trust 20 company to protect its customers, beneficiaries, and grantors. 21 (c) If the department orders a trust company to increase or adjust its capital, 22 the order must state the date by which the increase or adjustment must be made. An 23 order under this subsection does not prohibit the trust company from later applying to 24 the department to reduce capital requirements for the trust company under (b) of this 25 section. 26 (d) Subject to (b) of this section, a trust company to which the department 27 issues a certificate of authority shall at all times maintain capital in at least the amount 28 required under (a) of this section, as increased or decreased under (b) of this section. 29 (e) A trust company may not reduce or increase its outstanding capital through 30 dividend, redemption, issuance of shares, or otherwise without the prior written 31 approval of the department, unless otherwise permitted by this chapter.
01 (f) Prior approval by the department is not required for a decrease in surplus 02 caused by incurred losses that exceed undivided profits. A decrease to surplus as a 03 result of losses shall be replaced before payment of further dividends. 04 Sec. 06.26.130. Capital notes or debentures. (a) A trust company may, with 05 the written consent of the department, and if authorized by its articles of incorporation 06 or approved by persons owning two-thirds of the stock of the trust company entitled to 07 vote, issue convertible or nonconvertible capital notes or debentures. The principal 08 amount of notes and debentures outstanding at any time may not exceed 33 1/3 09 percent of the capital stock and surplus fund of the trust company on the date of 10 issuance. The rate and term are subject to the approval of the department, but the term 11 may not exceed 20 years. 12 (b) A trust company may not retire capital notes or debentures if the 13 retirement creates an impairment of its capital. Capital notes and debentures are 14 subordinated in right of payment in the event of insolvency or liquidation of the trust 15 company to the prior payment of all deposits and all claims of other creditors except 16 the holders of securities on a parity with the capital notes and debentures and the 17 holders of securities expressly subordinated to the capital notes and debentures. 18 Sec. 06.26.140. Cumulative voting. Shareholders may not use cumulative 19 voting in the election of directors unless cumulative voting is allowed by the trust 20 company's articles of incorporation. 21 Article 3. Operation of Offices. 22 Sec. 06.26.150. Trust company home office. (a) A trust company shall 23 continuously maintain in this state a home office where the trust company operates 24 and keeps its records. At least one executive officer shall maintain an office at the 25 home office. 26 (b) Each executive officer at the home office is an agent of the trust company 27 for service of process. 28 (c) A trust company may change its home office to any of its offices existing 29 at the time of the change within this state by filing a written notice with the 30 department setting out the name of the trust company, the street address of its home 31 office before the change, the street address to which the home office is to be changed,
01 and a copy of a resolution adopted by the trust company's board authorizing the 02 change. 03 (d) The change of the location of a home office takes effect on the 61st day 04 after the date the department receives the notice under (c) of this section, unless the 05 department establishes a different date or unless, before the 61st day, the department 06 notifies the trust company that the trust company shall establish to the satisfaction of 07 the department that the relocation is consistent with the original determination made 08 under AS 06.26.090 for the establishment of a trust company at that location, in which 09 event the change of home office takes effect when approved by the department. 10 Sec. 06.26.160. Trust company branch offices. (a) A trust company may 11 establish branch offices anywhere in the state by 12 (1) filing a written notice with the department setting out the name of 13 the trust company, the street address of the proposed branch office, and a description 14 of the activities proposed to be conducted at the branch office; 15 (2) filing with the department a copy of a resolution adopted by the 16 trust company's board authorizing the establishment or acquisition of the branch 17 office; and 18 (3) paying the filing fee established by the department by regulation. 19 (b) The department has 60 days from the date the department receives the 20 notice under (a) of this section to review the proposal for the branch office, and the 21 trust company may begin operating the branch office on the 61st day after the date the 22 department receives the notice, unless the department specifies a different date. 23 (c) The department may extend the 60-day period of review provided by (b) of 24 this section if the department determines that the proposed branch office raises issues 25 that require additional information or if the department needs additional time for 26 analysis. If the 60-day period of review is extended, the trust company may establish 27 the branch office only after the department approves the branch office in writing. The 28 department may deny the trust company permission to establish a branch office if the 29 department has safety or soundness concerns. 30 Sec. 06.26.170. Trust company representative offices. (a) A trust company 31 may establish or acquire representative trust offices anywhere in this state. To
01 establish or acquire a representative office, a trust company shall 02 (1) file a written notice with the department that sets out the name of 03 the trust company and the location of the proposed representative office; 04 (2) file with the department a copy of a resolution adopted by the trust 05 company's board authorizing the establishment or acquisition of the representative 06 office; and 07 (3) pay the filing fee established by the department by regulation. 08 (b) The department has 60 days from the date the department receives the 09 notice filed under (a) of this section to review the establishment or acquisition of a 10 representative office, and the trust company may begin operating the representative 11 office on the 61st day after the date the department receives the notice, unless the 12 department specifies a different date. 13 (c) The department may extend the 60-day period of review provided by (b) of 14 this section if the department determines that the written notice raises issues that 15 require additional information or if the department needs additional time for analysis. 16 If the 60-day period of review is extended, the trust company may establish the 17 representative office only after the department approves the office in writing. The 18 department may deny permission to establish or acquire a representative office of the 19 trust company if the department has safety or soundness concerns. 20 Sec. 06.26.180. Offices outside the state. (a) With the prior written approval 21 of the department, a trust company may establish a branch office or a representative 22 office outside this state. To establish a branch office or representative office outside 23 this state, a trust company shall 24 (1) submit an application to the department specifying the location of 25 the proposed office, the business to be conducted at the proposed office, and the laws 26 of the jurisdiction where the office will be located that permit the office to be 27 established; 28 (2) file with the department a copy of a resolution adopted by the trust 29 company's board authorizing the establishment or acquisition of the office; and 30 (3) pay the filing fee established by the department by regulation. 31 (b) The department may approve an application under (a) of this section for a
01 branch office or representative office if the department finds that 02 (1) the laws of the jurisdiction in which the office is to be located 03 permit the establishment of the office; and 04 (2) the department does not have a significant supervisory or 05 regulatory concern regarding the proposed office. 06 (c) If a trust company submits with the application a certified statement of the 07 governmental regulator for the jurisdiction in which the office is to be located 08 expressly permitting the establishment of the office, the trust company may establish 09 the office by following the procedures under AS 06.26.090, except that the trust 10 company may not establish the office before the 91st day after the date the department 11 receives the notice filed under AS 06.26.160(a) unless the department notifies the trust 12 company that the trust company may establish the office on an earlier date. 13 (d) The department may deny a trust company permission to establish a 14 branch office or representative office outside this state if the department has safety or 15 soundness concerns regarding 16 (1) the market to be served; 17 (2) whether the proposed organizational structure, capital structure, 18 and amount of capitalization are adequate; 19 (3) whether the anticipated volume and nature of the proposed office 20 indicate a reasonable probability of success and profitability based on the market 21 sought to be served; 22 (4) whether, as a group, the officers, directors, and employees have 23 sufficient fiduciary experience, ability, standing, competence, trustworthiness, and 24 integrity to justify a belief that the proposed office will operate in compliance with 25 law. 26 Sec. 06.26.190. Hours of operation. (a) A trust company and an interstate 27 state trust company or an international national trust company maintaining a trust 28 office under AS 06.26.810 - 06.26.895 may close on the legal holidays described in 29 AS 44.12.010 - 44.12.025. A notice of holiday closings shall be made available to the 30 trust company's customers by mail, by the Internet, or by other means. 31 (b) A trust company and an interstate state trust company or international trust
01 company maintaining a trust office under AS 06.26.810 - 06.26.895 may close on any 02 business day if the trust company 03 (1) notifies the department in advance of the closure; and 04 (2) makes a closure notice available to its customers by mail, by the 05 Internet, or by other means. 06 (c) The hours of operation, and any changes in the hours of operation, of a 07 trust company and an interstate state trust company or international trust company 08 maintaining a trust office under AS 06.26.810 - 06.26.895 must be submitted to the 09 department and must be made available to the trust company's customers by mail, by 10 the Internet, or by other means. 11 (d) Notwithstanding this section, the hours of operation of a trust company 12 with a certificate of authority issued under AS 06.05 are subject to AS 06.05.166. 13 Article 4. Private Trust Companies. 14 Sec. 06.26.200. Private trust companies. (a) Unless the department 15 expressly in writing exempts the person under this section from all or some of the 16 provisions of this chapter, a private trust company shall comply with the provisions of 17 this chapter applicable to a trust company. 18 (b) A person may apply in writing for an exemption from specific provisions 19 of this chapter. The department may grant the exemption, in whole or in part, if the 20 department finds that the person qualifies under (c) of this section and does not and 21 will not offer fiduciary services to the general public. 22 (c) To qualify as a private trust company, a person shall be a corporation 23 organized under AS 10.06, a limited liability company organized under AS 10.50, or a 24 limited partnership formed under AS 32.11, and the person's 25 (1) articles of incorporation, articles of organization, or partnership 26 agreement must prohibit the person from acting as a fiduciary of a trust, except for a 27 trust created during the lifetime or upon the death of 28 (A) one named individual; 29 (B) a child, grandchild, or greatgrandchild of the individual 30 identified in (A) of this paragraph, but not including a stepchild, 31 stepgrandchild, or stepgreatgrandchild;
01 (C) a spouse or former spouse, including a person divorced 02 from the individual, of an individual identified in (A) and (B) of this 03 paragraph; and 04 (2) headquarters must be located in this state, or the person must have 05 in force a contract with a qualified entity to represent the person on an exclusive or 06 nonexclusive basis in this state, including maintaining a set of records for each trust 07 for which the person acts as a fiduciary and receiving legal process on behalf of the 08 person; in this paragraph, "qualified entity" has the meaning given to "qualified 09 person" in AS 13.36.390(2)(B) and (C). 10 (d) At the expense of the applicant, the department may examine or 11 investigate the applicant in connection with an application for an exemption under 12 this section. Unless the application presents novel or unusual questions, the 13 department shall approve or deny the application for exemption not later than the 61st 14 day after the date that the department considers the application complete and accepted 15 for filing. If the application presents novel or unusual questions, the department may 16 extend the time for approving or denying the application. The department may require 17 the applicant to submit additional information the department considers necessary to 18 make an informed decision. 19 (e) The department may make an exemption under this section subject to 20 conditions or limitations imposed by the department that are consistent with this 21 chapter. 22 (f) The department may adopt regulations that are consistent with this chapter 23 defining the activities that do not constitute providing or offering fiduciary services to 24 the general public, specifying the provisions of this chapter that are subject to an 25 exemption under this section, and establishing procedures and requirements for 26 obtaining, maintaining, or revoking an exemption granted under this section. 27 Sec. 06.26.210. Requirements to apply for and maintain status as a 28 private trust company. (a) To obtain an exemption under AS 06.26.200, a person 29 shall file an application with the department containing 30 (1) a nonrefundable application fee established by the department by 31 regulation;
01 (2) information that demonstrates that the person qualifies under 02 AS 06.26.200(c); 03 (3) a detailed statement under oath showing the applicant's assets and 04 liabilities as of the end of the month that precedes the date of the filing of the 05 application with the department; 06 (4) a statement under oath of the reason for requesting the exemption; 07 (5) a statement under oath that the applicant currently does not offer 08 fiduciary services to the general public and that the applicant will not offer fiduciary 09 services to the general public without the prior written permission of the department; 10 (6) the current street address of the physical location in this state where 11 the applicant will maintain its records, the applicant's current telephone number at that 12 location, and a statement under oath that the address given is true and correct and not a 13 United States Postal Service post office box or a private commercial mail drop; 14 (7) a list of the specific provisions of this chapter or regulations 15 adopted under this chapter from which the applicant requests an exemption. 16 (b) The department may not approve an exemption under this section unless 17 the application complies with (a) of this section. 18 (c) To maintain its exemption under AS 06.26.200, a private trust company 19 (1) may not offer fiduciary services to the general public; 20 (2) shall continue to qualify under AS 06.26.200(c); and 21 (3) shall file an annual certification on or before December 31 of each 22 year on a form provided by the department that the private trust company is 23 maintaining the conditions and limitations of its exempt status; the annual certification 24 must be accompanied by a fee established by the department by regulation. 25 (d) The annual certification required under (c) of this section is valid only if it 26 bears an acknowledgment stamped by the department. The department has 60 days 27 from the date it receives the annual certification to review the annual certification and 28 return a copy of the acknowledged annual certification to the private trust company. 29 The burden is on the exempt private trust company to notify the department of a 30 failure to return a copy of an acknowledged annual certification within the 60-day 31 period.
01 (e) The department may examine or investigate the private trust company 02 periodically as necessary to verify the annual certification. 03 (f) Notwithstanding having an exemption under AS 06.26.200, a private trust 04 company shall comply with the home office provisions of AS 06.26.150 and shall 05 report to the department any change of address or telephone number within 30 days 06 after the change. 07 Sec. 06.26.220. Transfer of control. Control of an exempt private trust 08 company may not be sold or otherwise transferred with an exemption under 09 AS 06.26.200. In any change of control, the exempt status of the private trust 10 company automatically terminates on the effective date of the transfer, and the person 11 acquiring control must comply with this chapter. After transfer of control, a separate 12 application for an exemption under AS 06.26.200 must be filed with the department if 13 the acquiring person wishes to obtain or continue an exemption under AS 06.26.200. 14 Sec. 06.26.230. Revocation of exemption. (a) The department may revoke an 15 exemption under AS 06.26.200 if the exempt private trust company 16 (1) makes a false statement under oath on any document required to be 17 filed by this chapter; 18 (2) fails to submit to an examination as required by AS 06.26.200; 19 (3) withholds requested information from the department; or 20 (4) violates a provision of this chapter applicable to exempt private 21 trust companies. 22 (b) If the department determines from examination or other credible evidence 23 that an exempt private trust company has violated a requirement of this chapter, the 24 department may by personal delivery or registered or certified mail, return receipt 25 requested, notify the exempt private trust company in writing that the department will 26 revoke the private trust company's exemption as of a stated date, which may not be 27 before the fifth calendar day after the date that the notification is delivered or mailed. 28 The notification must state the grounds for the revocation with reasonable certainty. 29 After a revocation takes effect, the revocation is final, and the private trust company is 30 subject to all of the requirements and provisions of this chapter that are applicable to 31 private trust companies not exempt under AS 06.26.200.
01 (c) A private trust company shall comply with the provisions of this chapter 02 from which it was formerly exempt within five calendar days after the effective date 03 of a revocation of its exemption under this section. However, if the department 04 determines at the time of revocation that the private trust company has been engaging 05 in or attempting to engage in acts intended or designed to deceive or defraud, the 06 department may, in the department's sole discretion, shorten or eliminate the five- 07 calendar-day compliance period. 08 (d) If, within the time allowed under (c) of this section, the private trust 09 company does not comply with all of the provisions of this chapter, including the 10 capitalization requirements that have been determined by the department as necessary 11 to assure the safety and soundness of the private trust company, the department may 12 (1) file a court action or pursue another remedy provided by this 13 chapter; or 14 (2) refer the private trust company to the attorney general for 15 institution of appropriate legal proceedings against the private trust company. 16 Sec. 06.26.240. Conversion to trust company. (a) A private trust company 17 may not offer fiduciary services to the general public as a trust company until the 18 private trust company satisfies the requirements of this section. 19 (b) The private trust company shall file a notice with the department on a form 20 prescribed by the department, furnish a copy of a resolution adopted by the board 21 authorizing the private trust company to offer fiduciary services to the general public, 22 pay any filing fee established by the department by regulation, and comply with the 23 requirements of this chapter for trust companies. The notice must provide the name of 24 the private trust company and acknowledge that any exemption granted or otherwise 25 applicable to the private trust company under AS 06.26.200 ceases to apply on the 26 effective date of the notice. 27 (c) The department has 60 days after the department receives the notice under 28 (a) of this section to review the conversion, and a private trust company may begin 29 providing or offering fiduciary services to the general public on the 61st day after the 30 date that the department receives a notice under (a) of this section from the private 31 trust company, unless the department specifies a different date.
01 (d) The department may extend the 60-day period of review provided by (c) of 02 this section if the department determines that the notice raises issues that require 03 additional information or if the department needs additional time for analysis. If the 04 60-day period of review is extended, the private trust company may offer fiduciary 05 services to the general public only after written approval by the department. 06 (e) The department may deny a private trust company permission to offer 07 fiduciary services to the general public as a trust company if the department finds that 08 the private trust company does not meet the requirements of this chapter for trust 09 companies. 10 Sec. 06.26.245. Trust company authority. The provisions of AS 06.26.200 - 11 06.26.240 may not be interpreted to prevent a trust company from providing fiduciary 12 services as a private trust company. 13 Article 5. Investments, Loans, and Deposits. 14 Sec. 06.26.250. Regulations on investments. The department may adopt 15 regulations to establish limits, requirements, or exemptions for particular classes or 16 categories of investment, or limit or expand investment authority for trust companies 17 for particular classes or categories of securities or other property. 18 Sec. 06.26.260. Pledge of assets. (a) A trust company may not pledge or 19 create a lien on any of the assets belonging to the trust company except to secure 20 (1) the repayment of money borrowed; 21 (2) trust deposits as specifically authorized or required by 22 AS 06.26.370 or by regulations adopted under this chapter; or 23 (3) deposits made by the United States government, the state, or a 24 municipality, or an agency of those governmental bodies. 25 (b) An act, a deed, a conveyance, a pledge, or a contract that violates this 26 section is void. 27 Article 6. Trust Assets. 28 Sec. 06.26.370. Deposits of trust assets. (a) A trust company may deposit 29 trust money or other trust assets with itself as an investment if the settlor or the 30 beneficiary authorizes the deposit and if 31 (1) the trust company maintains as security for the deposits a separate
01 fund of securities that may be used for trust investments and that are under the control 02 of a federal reserve bank or a clearing corporation in this state or elsewhere; in this 03 paragraph, "clearing corporation" has the meaning given in AS 45.08.102; 04 (2) the total market value of the security fund maintained under (1) of 05 this subsection is at all times at least equal to the deposit; 06 (3) the security fund maintained under (1) of this subsection is 07 expressly designated as a security fund; and 08 (4) the security fund maintained under (1) of this subsection is 09 maintained under the control of a person listed in AS 06.26.010(a). 10 (b) A trust company may make periodic withdrawals from or additions to the 11 security fund required by (a) of this section if the trust company maintains the value 12 required by (a) of this section for the security fund. Income from the securities in the 13 security fund belongs to the trust company. 14 (c) Notwithstanding (a) of this section, security under (a) of this section for a 15 deposit is not required to the extent the deposit is insured by the Federal Deposit 16 Insurance Corporation or its successor. 17 Sec. 06.26.380. Common investment funds. Subject to regulations adopted 18 by the department, a trust company may invest trust assets in common investment 19 funds. 20 Sec. 06.26.390. Fee determination; investment and management costs. (a) 21 A trust company shall deal at arm's length with a person when arranging the 22 compensation to be paid by the person for the services of the trust company. Any 23 compensation paid to the trust company must be a reasonable amount with respect to 24 the services rendered. 25 (b) When investing and managing trust assets, a trust company may only incur 26 costs that are appropriate and reasonable in relation to the assets, the purposes of the 27 trust, and the skills of the trust company. 28 Sec. 06.26.400. Disclosure of conflicts of interest. Before accepting 29 appointment as a trustee, a trust company shall disclose any conflict of interest that 30 may reasonably be expected to arise in the relationship. 31 Sec. 06.26.410. Requirements for handling trust assets. A trust company,
01 its representatives, and its appointees shall observe the requirements applicable to 02 trustees under AS 13.36.225 - 13.36.290 (Alaska Uniform Prudent Investor Act). 03 Article 7. Ownership. 04 Sec. 06.26.450. Acquisition of control. (a) Except as expressly otherwise 05 permitted under this chapter, a person may not, without the prior written approval of 06 the department, directly or indirectly acquire control of a trust company through a 07 change in a legal or beneficial interest in voting securities of a trust company or a 08 corporation or other person who owns voting securities of a trust company. 09 (b) This section does not apply to 10 (1) the acquisition of securities in connection with the exercise of a 11 security or other interest in full or partial satisfaction of a debt previously contracted 12 for in good faith if the acquiring person files written notice of acquisition with the 13 department before the person votes the securities acquired; 14 (2) the acquisition of voting securities in any class or series by a 15 person in control who has previously complied with and received approval to acquire 16 control under AS 06.26.450 - 06.26.480 or who was identified as a person in control in 17 an earlier application filed with and approved by the department; 18 (3) an acquisition or transfer by operation of law, a will, or in testate 19 succession if the acquiring person files written notice of acquisition with the 20 department before the person votes the securities acquired; or 21 (4) a transaction exempted by the department by regulation or order 22 because the transaction is not within the purposes of AS 06.26.450 - 06.26.480. 23 Sec. 06.26.460. Application for acquisition of control. (a) A proposed 24 transferee seeking approval under AS 06.26.450 to acquire control of a trust company 25 shall file with the department 26 (1) an application in the form prescribed by the department; 27 (2) the filing fee established by the department by regulation; and 28 (3) all information required by regulation or that the department 29 requires for a particular application in order to make an informed decision to approve 30 or reject the proposed acquisition. 31 (b) If the proposed transferee under (a) of this section includes a group of
01 persons acting together, the department may require each member of the group to 02 provide information to the department. 03 (c) If the proposed transferee is not a resident of the state, a corporation 04 organized under AS 10.06, or a foreign corporation qualified under AS 10.06 to 05 transact business in this state, the proposed transferee shall file with the department a 06 written consent to service of process on a resident of this state for any court action 07 arising out of or connected with the proposed acquisition of control. 08 (d) Promptly after the department accepts the application as complete, the 09 proposed transferee shall publish notice of the application, the date of filing the 10 application, and the identity of each participant in the acquisition of control in the 11 form specified by the department in a newspaper of general circulation published in 12 the community proposed as the trust company's principal place of business. If a 13 newspaper of general circulation is not published in the community, the notice shall be 14 published in a newspaper of general circulation near the community. Publication of 15 notice of an application may be deferred for up to 31 days after the date the 16 application is filed if 17 (1) the proposed transferee requests confidential treatment and 18 represents that a public announcement of the tender offer and the filing of appropriate 19 forms with the United States Securities and Exchange Commission or the appropriate 20 federal banking agency, as applicable, will occur within the period of deferral; and 21 (2) the department determines that public interest will not be harmed 22 by the requested confidential treatment. 23 (e) The department may waive the requirement that a notice be published or 24 permit delayed publication of the notice if the department makes a written 25 determination that waiver or delay is in the public interest. 26 Sec. 06.26.470. Decision on application for acquisition of control. (a) The 27 department shall approve or deny an application for acquisition of control not later 28 than the 60th day after the date that the notice regarding acquisition of control is 29 published under AS 06.26.460. 30 (b) If the department approves an application filed under AS 06.26.460, the 31 applicant may acquire control. Any written commitment from the proposed transferee
01 offered to and accepted by the department as a condition for approval of the 02 application is enforceable against the trust company and the transferee. 03 Sec. 06.26.480. Objection to other transfer. AS 06.26.450 - 06.26.480 may 04 not be construed to prevent the department from investigating, commenting on, or 05 seeking to enjoin or set aside a transfer of voting securities that evidence a direct or 06 indirect interest in a trust company if the department considers the transfer to be 07 against the public interest. 08 Article 8. Governance. 09 Sec. 06.26.500. Voting securities held as trust assets. (a) Voting securities 10 of a trust company held by the trust company as trust assets under a will or trust, 11 whether registered in the trust company's own name or in the name of its nominee, 12 may not be voted in the election of directors or on a matter affecting the compensation 13 of directors, officers, or employees of the trust company unless 14 (1) under the terms of the will or trust, the manner in which the voting 15 securities are to be voted may be determined by a donor or beneficiary of the will or 16 trust and the donor or beneficiary actually makes the determination in the matter at 17 issue; 18 (2) the terms of the will or trust expressly direct the manner in which 19 the securities must be voted to the extent that no discretion is vested in the trust 20 company as fiduciary; or 21 (3) the securities are voted solely by a person who is a joint fiduciary, 22 but who is not a person who is affiliated with the trust company, as if the joint 23 fiduciary were the sole fiduciary. 24 (b) Voting securities of a trust company that may not be voted under this 25 section are considered to be authorized but unissued for the purpose of determining the 26 procedures for and results of the vote under this section. 27 Sec. 06.26.510. Board of directors. (a) The board of directors of a trust 28 company shall consist of at least five but not more than 25 directors, and the majority 29 of the directors must be residents of this state. The principal executive officer of the 30 trust company is a member of the board and the board's presiding officer unless the 31 board elects a different presiding officer. The presiding officer shall perform the
01 duties designated by the board. 02 (b) Unless the department consents in writing, a person may not serve as a 03 director of a trust company if 04 (1) the trust company incurs an unreimbursed loss attributable to a 05 charged-off obligation of the person or holds a judgment against the person or against 06 another person who was controlled by the person when the loan that gave rise to the 07 judgment or charged-off obligation was funded and went into default; 08 (2) the person has been convicted of a felony, or of another crime 09 involving moral turpitude or breach of trust; or 10 (3) the person, acting as a personal representative, made a loan of trust 11 money or other assets, or a purchase or sale of trust assets, that is voidable under 12 AS 13.16.400 and the person has not corrected the situation. 13 (c) If a trust company does not elect directors before the 61st day after the date 14 of its regular annual meeting, the department may appoint a person to operate the trust 15 company and elect directors. If the appointed person is unable to locate or elect 16 persons willing and able to serve as directors, the department may close the trust 17 company for liquidation. 18 (d) A vacancy on a board that reduces the number of directors to fewer than 19 five shall be filled not later than the 30th day after the date that the vacancy occurs. If 20 the vacancy on the board is not filled within 30 days after the date that the vacancy 21 occurs, the department may appoint a person to operate the trust company and elect a 22 board of at least five persons. If the appointed person is unable to locate or elect five 23 persons willing and able to serve as directors, the department may close the trust 24 company for liquidation. 25 (e) Before beginning each term to which a person is elected to serve as a 26 director of a trust company, the person shall submit an affidavit to be filed with the 27 minutes of the trust company stating that the person, to the extent applicable, 28 (1) accepts the position and is not disqualified from serving in the 29 position; 30 (2) will not violate or knowingly permit a director, an officer, or an 31 employee of the trust company to violate any law applicable to the conduct of business
01 of the trust company; and 02 (3) will diligently perform the duties of the position. 03 Sec. 06.26.520. Board meetings and review of reports. (a) The board of 04 directors of a trust company shall meet at least once every three months. The 05 department or a director may call a special meeting of the board. A majority of the 06 board constitutes a quorum. The board shall keep minutes of each board meeting, 07 including a record of attendance and a record of all votes. 08 (b) At least once every three months, the board of directors of a trust company 09 shall review written reports prepared by the president, other officers of the trust 10 company, or a trust committee appointed under AS 06.26.550. The reports must 11 include the accounts that have been opened or closed during the calendar quarter 12 before the meeting and the trust accounts subject to annual review during the calendar 13 quarter before the meeting. 14 Sec. 06.26.530. Officers. (a) The board shall annually appoint the officers of 15 the trust company. The officers serve at the pleasure of the board. 16 (b) The president of the trust company is the principal executive officer 17 primarily responsible for the execution of board policies and operation of the trust 18 company. The trust company shall have an officer responsible for the maintenance 19 and storage of all records of the trust company and for required attestation of 20 signatures. These positions may not be held by the same person. The board may 21 appoint other officers of the trust company as the board considers necessary. 22 Sec. 06.26.540. Prohibition of certain action by officer or employee. 23 Unless expressly authorized by a resolution of the board recorded in the minutes of the 24 board, an officer or employee may not create or dispose of a trust company asset or 25 create or incur a liability on behalf of the trust company. 26 Sec. 06.26.550. Trust committee. (a) The board may appoint a trust 27 committee to act for the company in matters dealing with the initial and annual 28 reviews of accounts, account acceptance, and investment strategies. A trust committee 29 shall consist solely of directors, officers, or employees of the trust company, or any 30 combination of these positions. The trust committee shall keep a record of its actions 31 and shall report in writing to the board on all actions taken by the trust committee
01 since the previous board meeting. The board shall ratify or rescind each action. 02 (b) The trust committee shall meet at least once a month to review existing 03 accounts and to ratify or rescind newly accepted accounts. The trust committee may 04 not ratify a new account unless it is approved by a majority of the members of the trust 05 committee present at the meeting at which the new account is considered. 06 (c) A trust committee may elect one or more officers to accept new accounts, 07 subject to the requirements of (b) of this section. 08 Sec. 06.26.560. Prohibited acts. (a) A director, an officer, an employee, or a 09 shareholder of a trust company may not 10 (1) conceal information or a fact, or remove, destroy, or conceal a 11 book or record of the trust company, for the purpose of concealing information or a 12 fact from the department or an agent of the department; or 13 (2) for the purpose of concealing, remove or destroy a book or record 14 of the trust company that is material to a pending or anticipated court or administrative 15 proceeding. 16 (b) A director, an officer, or an employee of a trust company may not make a 17 false entry in the records, a report, or a statement of the trust company. 18 Sec. 06.26.570. Transactions with management and affiliates; penalties. 19 (a) Without the prior approval of a disinterested majority of the board recorded in the 20 minutes, or, if a disinterested majority cannot be obtained, the prior written approval 21 of the department, a trust company may not directly or indirectly 22 (1) sell or lease an asset of the trust company to a director, an officer, a 23 principal shareholder, or an affiliate of the trust company; 24 (2) purchase or lease property in which a director, an officer, a 25 principal shareholder, or an affiliate of the trust company has an interest; or 26 (3) extend credit to a director, an officer, a principal shareholder, or an 27 affiliate of the trust company. 28 (b) In addition to the requirements of (a) of this section, a lease transaction 29 described in (a)(2) of this section involving real property may not be consummated, 30 renewed, or extended by the trust company without the prior written approval of the 31 department.
01 (c) A trust company may not extend credit to a director, an officer, an 02 employee, a principal shareholder, or an affiliate of the trust company unless the 03 extension of credit 04 (1) is made on substantially the same terms, including interest rates 05 and collateral requirements, as the terms prevailing at the time for comparable 06 transactions by the trust company with persons who are not directors, officers, 07 employees, principal shareholders, or affiliates of the trust company; 08 (2) does not involve more than the normal risk of loss or present other 09 unfavorable features; and 10 (3) follows credit underwriting procedures that are as stringent as the 11 underwriting procedures applicable to comparable transactions by the trust company 12 with persons who are not directors, officers, employees, principal shareholders, or 13 affiliates of the trust company. 14 (d) The department may adopt regulations to implement this section, including 15 regulations to establish limits, requirements, or exemptions other than those specified 16 by this section for particular categories of transactions. 17 (e) In this section, "affiliate" does not include a subsidiary of the trust 18 company. 19 Sec. 06.26.580. Trust asset transactions involving certain securities, assets, 20 or information. (a) Except as provided in this chapter, or as authorized under the 21 instrument creating the relationship, a trust company may not invest trust assets in the 22 stock or obligations of, or use trust assets to acquire property from, the trust company 23 or any of the trust company's officers, directors, or employees. A trust company may 24 not sell trust assets to the trust company or to any of the trust company's directors, 25 officers, or employees. 26 (b) A trust company may not use material inside information in connection 27 with a decision or recommendation to purchase or sell a security that is a trust asset. 28 Sec. 06.26.585. Policies and procedures. A trust company shall adopt 29 written policies and procedures regarding decisions or recommendations to purchase 30 or sell a security that is a trust asset to facilitate compliance with federal and state 31 securities laws. These policies and procedures must include the prohibition in
01 AS 06.26.580(b). 02 Sec. 06.26.590. Fiduciary responsibility. The board of a trust company is 03 responsible for the proper exercise of fiduciary powers by the trust company and for 04 each matter that is related to the exercise of fiduciary powers, including 05 (1) the determination of policies; 06 (2) the investment and disposition of trust assets; and 07 (3) the direction and review of the actions of each officer, employee, 08 and committee employed or used by the trust company in the exercise of its fiduciary 09 powers. 10 Sec. 06.26.600. Trust account record keeping. A trust company shall keep 11 its trust assets records separate and distinct from other records of the trust company in 12 the manner required by state and federal law. The trust assets records must contain all 13 material information relating to each trust assets account, as appropriate under the 14 circumstances. 15 Sec. 06.26.610. Customer records confidential. (a) The trust company 16 records relating to customers are confidential and may not be made public unless 17 (1) disclosure is compelled by a court or administrative order; 18 (2) disclosure is required by federal or state law; 19 (3) disclosure is authorized in writing by the customer; 20 (4) disclosure is made to the holder of a negotiable instrument drawn 21 on the trust company as to whether the drawer has sufficient money or other assets in 22 the financial institution to cover the instrument; or 23 (5) an inquiry has been made by a state financial institution, or by a 24 credit-reporting agency regulated under 15 U.S.C. 1681 - 1681u (Fair Credit 25 Reporting Act) solely for the express purpose of determining the credit worthiness of 26 the customer as an applicant for credit, and the information disclosed by the trust 27 company, state financial institution, or credit-reporting agency relates only to the 28 payment habits of the customer in connection with loans or other credit 29 accommodations and does not pertain to records concerning deposit balances in 30 savings or checking accounts. 31 (b) When disclosure of trust company records is required or allowed under
01 (a)(1) or (2) of this section, the trust company shall notify the customer of the 02 disclosure. If notification before disclosure is not possible, the trust company shall 03 immediately notify the customer of the disclosure or inquiry. However, the trust 04 company may not notify the customer if disclosure is made under a search warrant or 05 under a court order issued at the request of a grand jury. 06 (c) When disclosure of trust company records is compelled by a court order 07 under (a)(1) of this section, the court may provide in the order for the reimbursement 08 of the trust company for the costs allowed by the rules of court and incurred by the 09 trust company to comply with the order. 10 Sec. 06.26.620. Insurance; bonds. (a) The board of directors of a trust 11 company shall maintain bonding and other insurance for the trust company against 12 dishonesty, fraud, defalcation, forgery, theft, embezzlement, burglary, robbery, theft, 13 and other similar insurable losses and hazards as required by the department by 14 regulation. The board shall obtain the bonding and other insurance from a person 15 authorized under AS 21 to act as an insurer or a surety insurer in this state. 16 (b) The board of directors shall procure errors and omissions insurance in the 17 amount of at least $500,000. 18 (c) At least once each year, the board of directors shall review the bonding and 19 other insurance required by this section to determine whether the coverage is adequate 20 in relation to the exposure of the trust company. The minimum amount of insurance 21 required by this section does not automatically represent adequate bonding and 22 insurance coverage in relation to the exposure. Immediately after procuring the 23 bonding and other insurance, the board shall file copies of the documents representing 24 the bonding and other insurance with the department. 25 Sec. 06.26.630. Reports of apparent crime. (a) A trust company that is the 26 victim of a robbery, that has a shortage of money or other assets in excess of $5,000, 27 or that is the victim of an apparent or suspected misapplication of its money or other 28 assets in any amount by a director, an officer, or an employee shall report the robbery, 29 shortage, or apparent or suspected misapplication to the department within 48 hours 30 after it is discovered. The initial report may be oral if the trust company promptly 31 confirms the report in writing to the department. The trust company or a director, an
01 officer, an employee, or an agent of the trust company is not liable for defamation to 02 or subject to any another cause of action based on supplying the information in the 03 report. 04 (b) A trust company may satisfy the requirements of (a) of this section by 05 filing with the department a copy of a written report filed with the appropriate law 06 enforcement agency. 07 Article 9. Organic Change. 08 Sec. 06.26.650. General provisions for conversions, mergers, and 09 consolidations. (a) A national bank whose main office is located in the state or a 10 state bank whose main office is located in the state may convert to a trust company or 11 merge or consolidate with a trust company, and a trust company may merge or 12 consolidate with another trust company, if the conversion, merger, or consolidation is 13 consistent with federal and state law and approved by the department. The 14 requirements of AS 06.26.650 - 06.26.670 are in addition to the merger and 15 consolidation requirements of AS 10.06. 16 (b) Before merger or consolidation under (a) of this section, a trust company 17 shall file with the department a merger or consolidation application and other 18 information and reports that the department requires under AS 06.26.660. 19 (c) The department, in the exercise of its power to approve or disapprove 20 applications for merger or consolidation under (a) of this section, shall act in the 21 interests of promoting and maintaining a sound trust company system, promoting the 22 security of deposits and customers, preserving of the liquid position of trust 23 companies, and preventing injurious credit expansions and contractions. 24 (d) A trust company converting to or merging or consolidating with a national 25 bank shall submit to the department a copy of any application to the United States 26 Comptroller of the Currency for a national bank charter or any other application to the 27 United States Comptroller of the Currency to convert, merge, or consolidate when the 28 applications are forwarded to the United States Comptroller of the Currency. 29 Sec. 06.26.660. Merger or consolidation. (a) To merge or consolidate under 30 AS 06.26.650, the merging persons shall file with the department the original articles 31 of merger or consolidation, a number of copies of the articles of merger or
01 consolidation equal to the number of trust companies involved in the merger or 02 consolidation, and an application in the form required by the department. The 03 department may require the submission of additional information it considers 04 necessary to make an informed decision. 05 (b) The department may approve a merger or a consolidation if 06 (1) the surviving or new trust company will be solvent and have 07 adequate capitalization for its operations and location; 08 (2) the surviving or new trust company has in all respects complied 09 with the statutes and regulations governing the organization of a trust company in this 10 state; 11 (3) all obligations and liabilities of each trust company that is a party 12 to the merger or consolidation have been properly discharged or otherwise lawfully 13 assumed or retained by a trust company or other fiduciary; 14 (4) a surviving or new trust company is not authorized to act as a 15 fiduciary under this chapter, will not act as a fiduciary, and has otherwise complied 16 with the laws of this state; 17 (5) the surviving or new trust company satisfies the provisions in 18 AS 06.26.090 that the department determines apply to the trust company; and 19 (6) all conditions imposed by the department have been satisfied. 20 (c) If the department approves the merger or consolidation and finds that all 21 investigative expenses incurred by the department and all required filing fees have 22 been paid, the department shall issue a certificate of merger or consolidation. 23 Sec. 06.26.670. Rights of dissenters. In addition to the dissenter's rights 24 under AS 10.06 for a merger or consolidation, if a shareholder of a trust company 25 objects to a conversion of the trust company, the dissenting shareholder's rights shall 26 be exercised under and governed by AS 10.06.574 - 10.06.582 as if the conversion 27 were a merger. 28 Sec. 06.26.680. Authority to purchase assets of another trust company. 29 (a) A trust company with the prior written approval of the department may purchase 30 all or substantially all of the assets of another trust company, including the right to 31 control accounts established with the trust accounts. Except as otherwise expressly
01 provided by another statute, the purchase by a trust company of all or part of the assets 02 of another trust company does not make the purchasing trust company responsible for 03 a liability or obligation of the selling trust company that the purchasing trust company 04 does not expressly assume. Except as otherwise provided by statute, AS 06.26.450 - 05 06.26.480 do not govern or prohibit the purchase by a trust company of all or part of 06 the assets of a person who is not a trust company or an exempt private trust company. 07 (b) To purchase assets under (a) of this section, a trust company shall file with 08 the department an application in the form required by the department. The department 09 shall investigate the condition of the purchaser and seller and may require the 10 submission of additional information it considers necessary to make an informed 11 decision. The department shall approve the purchase if 12 (1) the purchasing trust company will be solvent after the purchase and 13 have sufficient capitalization for its operations and location; 14 (2) the purchasing trust company has complied with all applicable 15 statutes and regulations in this state; 16 (3) all fiduciary obligations and liabilities of the purchasing trust 17 company and selling trust company have been properly discharged or otherwise 18 lawfully assumed by the purchasing trust company; 19 (4) all conditions imposed by the department have been satisfied or 20 otherwise resolved; and 21 (5) all expenses incurred by the department and all required fees have 22 been paid. 23 (c) A purchase under this section is effective on the date the department 24 approves the purchase unless the purchase agreement provides for, and the department 25 consents to, a different effective date. 26 Sec. 06.26.690. Authority to act as disbursing agent. A purchasing trust 27 company may hold the purchase price and any additional money or other assets 28 delivered to it by the selling trust company in trust for the selling trust company and 29 may act as an agent of the selling trust company in disbursing the money or other 30 assets by paying the creditors of the selling trust company. If the purchasing trust 31 company acts under a written contract of agency approved by the department that
01 specifically names each creditor and the amount to be paid each creditor, and if the 02 agency is limited to the purely ministerial act of paying creditors the amounts due 03 them as determined by the selling trust company and reflected in the contract of 04 agency and does not involve discretionary duties or authority other than the 05 identification of the creditors named, the purchasing trust company 06 (1) may rely on the contract of agency and the instructions included in 07 it; and 08 (2) is not responsible for 09 (A) an error made by the selling trust company when 10 determining its liabilities, the creditors to whom the liabilities are due, or the 11 amounts due to the creditors; or 12 (B) a preference that results from the payments made under the 13 contract of agency and the instructions included in the contract. 14 Sec. 06.26.700. Liquidation of selling trust company. If a selling trust 15 company is at any time after the sale of assets voluntarily or involuntarily closed for 16 liquidation by a state or federal regulatory agency, the purchasing trust company shall 17 pay to the receiver of the selling trust company the balance of the money or other 18 assets held by the purchasing trust company in trust for the selling trust company and 19 not yet paid to the creditors of the selling trust company. Without further action, the 20 purchasing trust company is then discharged of all responsibilities to the selling trust 21 company and the selling trust company's receiver, creditors, and shareholders. 22 Sec. 06.26.710. Payment to creditors. A purchasing trust company may pay 23 a creditor of the selling trust company the amount to be paid the creditor under the 24 terms of the contract of agency entered into under AS 06.26.690 by opening an agency 25 account in the name of the creditor, crediting the account with the amount to be paid 26 the creditor under the terms of the agency contract, and mailing or personally 27 delivering a duplicate of the written evidence of the credit to the creditor at the 28 creditor's address shown in the records of the selling trust company. With regard to 29 the creditor, the purchasing trust company is an agent of the selling trust company 30 only to the extent of the credit reflected by the written evidence of the credit. 31 Sec. 06.26.720. Sale of assets. (a) The board of a trust company, with the
01 department's approval, may cause a trust company to sell all or substantially all of its 02 assets, including the right to control accounts established with the trust company for 03 trust assets, without shareholder approval if the department finds 04 (1) the interests of the trust company's creditors and depositors and 05 other customers are not jeopardized because of an unsafe or unsound condition of the 06 trust company; 07 (2) the sale is in the best interest of the trust company's creditors and 08 depositors and other customers; and 09 (3) the Federal Deposit Insurance Corporation or its successor 10 approves the transaction unless the deposits of the trust company are not insured by 11 the Federal Deposit Insurance Corporation or its successor. 12 (b) A sale under this section must include an assumption and promise by the 13 purchaser to pay or otherwise discharge 14 (1) all of the trust company's liabilities to customers; 15 (2) all of the trust company's liabilities for the salaries of the trust 16 company's employees incurred before the date of the sale; 17 (3) the obligations incurred by the department arising out of the 18 supervision or sale of the trust company; and 19 (4) the fees and any other payment due to the department under this 20 chapter and assessments due to the department under AS 06.01.010. 21 (c) This section does not limit the incidental power of a trust company to buy 22 and sell assets in the ordinary course of its operations. 23 (d) The sale by a trust company of all or substantially all of its assets with 24 shareholder approval is considered a voluntary dissolution and liquidation and is 25 governed by AS 06.26.730 - 06.26.800. 26 Article 10. Dissolution and Liquidation. 27 Sec. 06.26.730. Voluntary liquidation. (a) Without department approval, a 28 trust company may not cease acting as a fiduciary in this state and voluntarily 29 surrender its certificate of authority and as a consequence be relieved of the necessity 30 to comply with the requirements of this chapter. 31 (b) A trust company proposing to cease acting as a fiduciary in this state shall
01 submit to the department 02 (1) a certified copy of a resolution of the trust company's board of 03 directors reflecting the board's decision that the trust company should cease acting as a 04 fiduciary in this state; and 05 (2) the trust company's plan adopted by its board for winding up its 06 fiduciary operations in this state. 07 (c) The department may approve or disapprove the trust company's plan for 08 winding up its fiduciary operations in this state based on the department's evaluation 09 of whether the plan provides adequate protection for those persons and interests for 10 whom the trust company acts as a fiduciary. The department's approval may be 11 subject to any condition the department determines appropriate under the 12 circumstances. 13 (d) During the implementation of a trust company's plan for winding up its 14 fiduciary operations in this state, the department retains the authority to supervise the 15 trust company and may conduct any examination relating to either the trust company 16 or the plan for winding up that the department considers necessary or appropriate. 17 (e) If the department has reason to conclude that the trust company is not 18 safely or expeditiously implementing the approved plan for winding up the trust 19 company's fiduciary operations in this state, the department may 20 (1) begin revocation proceedings under AS 06.26.740; 21 (2) take possession of the trust company's trust business in this state in 22 the same manner, with the same effect, and subject to the same rights accorded to the 23 trust company under AS 06.26.750. 24 (f) The department shall cancel the trust company's certificate of authority if 25 the department approves the trust company's plan for winding up its fiduciary 26 operations in this state and if all of the following conditions that apply to the trust 27 company have been met: 28 (1) the trust company has completed its plan for winding up its 29 fiduciary operations in this state consistent with any conditions that the department 30 imposed on the plan under (c) of this section; 31 (2) the trust company has been relieved under all applicable laws of all
01 duties as trustee, executor, administrator, registrar of stocks and bonds, or any other 02 type of fiduciary position under court, private, or other appointment that the trust 03 company had accepted; 04 (3) if the trust company has its principal place of business in this state, 05 the trust company has, under all applicable laws, wound up its fiduciary operations in 06 each of the other jurisdictions where the trust company solicited appointment or 07 served as a fiduciary, or otherwise acted as a fiduciary; 08 (4) if the trust company has its principal place of business in this state 09 and is not authorized to engage in activities other than acting as a fiduciary, the trust 10 company is being liquidated under AS 06.26.760 - 06.26.800. 11 (g) Upon the department's canceling the trust company's certificate of 12 authority, the trust company may not without obtaining a new certificate of authority 13 act as a fiduciary in this state, or in any jurisdiction. 14 Sec. 06.26.740. Revocation. (a) If the department determines that any of the 15 following factors exist, the department may revoke, consistent with AS 06.01.030 and 16 regulations adopted by the department under AS 06.01.030 and this chapter, a trust 17 company's certificate of authority: 18 (1) the existence of the trust company, or its authority to act as a 19 fiduciary, has been terminated or suspended under the laws of the state or other 20 jurisdiction in which the trust company is organized; 21 (2) the trust company's authority to act as fiduciary has been 22 terminated or suspended under the laws of the state or other jurisdiction in which the 23 trust company is organized, or its license to act as a fiduciary has been terminated or 24 suspended under the laws of any other jurisdiction in which the trust company had 25 been authorized to act as a fiduciary; 26 (3) a receiver, liquidator, or conservator has been appointed for the 27 trust company under the laws of the state or other jurisdiction in which the trust 28 company is organized, or for its operation in any other jurisdiction in which the trust 29 company operates; 30 (4) the trust company is violating or has violated or the department has 31 reasonable cause to believe is about to violate
01 (A) a law or regulation; 02 (B) a condition imposed by the department in writing in 03 connection with approving an application or notice under this chapter or 04 granting any other request of the trust company under this chapter; 05 (C) a written agreement that the trust company entered into 06 with the department; 07 (D) a cease and desist order issued by the department under 08 AS 06.01.030; 09 (5) the trust company is engaging in or has engaged in, or the 10 department has reasonable cause to believe the trust company is about to engage in an 11 unsafe or unsound practice; 12 (6) the trust company has ceased to pay its debts in the ordinary course 13 of business, is incapable of paying its debts as they mature, has liabilities in excess of 14 its assets, or is subject to or has applied for an adjudication in bankruptcy, 15 reorganization, or other relief under any bankruptcy, reorganization, insolvency, or 16 moratorium law; 17 (7) the trust company has ceased to act as a fiduciary in this state; 18 (8) the trust company has failed to pay any fees, charges, forfeitures, 19 penalties, or other payment due to the department under this title. 20 (b) If the department has reasonable cause to believe any of the factors 21 identified in (a) of this section is true, and if the department determines it is necessary 22 to protect the persons and interests in this state for whom the trust company acts as a 23 fiduciary or to protect the property in this state to which the trust company holds title 24 as a fiduciary or in which the trust company holds an interest as a fiduciary, the 25 department may immediately suspend the trust company's certificate of authority. 26 Sec. 06.26.750. Authority to take possession. If the department revokes a 27 trust company's certificate of authority under AS 06.26.740(a), the department may 28 take possession of the trust company's fiduciary operations in this state and may 29 appoint a receiver for the liquidation of the trust company's fiduciary operations in this 30 state. If the trust company has its principal place of business in this state, the 31 department may take possession of, and appoint a receiver for the liquidation of all the
01 trust company's fiduciary operations wherever they are conducted. 02 Sec. 06.26.760. Department in possession. (a) When the department has 03 taken possession of a trust company, it is vested with the full and exclusive power of 04 management and control, including the power to act as a trustee for trust assets, to 05 continue or discontinue the operation of the trust company, to stop or limit the 06 payment of the trust company's obligations, to employ necessary assistants, to execute 07 an instrument in the name of the trust company, to commence, defend, and conduct in 08 the trust company's name any action or proceeding to which the trust company may be 09 a party, to terminate the possession by restoring the trust company to its board, and to 10 reorganize or liquidate the trust company under this chapter. As soon as practicable 11 after taking possession, the department shall make an inventory of the trust assets and 12 the trust company assets and file a copy of the inventory with the superior court. 13 (b) When the department has taken possession, the following dates are 14 postponed until six months after the possession begins: 15 (1) notwithstanding other provisions of law, the date on which any 16 period of limitation fixed by a statute or agreement would otherwise expire on a claim 17 or right of action of the trust company; or 18 (2) the date on which an appeal must be taken or a pleading or other 19 document must be filed by the trust company in any pending court action or other 20 proceeding. 21 (c) A judgment, lien, or attachment may not be enforced against trust company 22 assets while the assets are in possession of the department. Upon the election of the 23 department in connection with a liquidation or reorganization, 24 (1) any lien or attachment, other than an attorney's or mechanic's lien, 25 obtained upon a trust company asset during the department's possession or within four 26 months before beginning that possession may be vacated, except liens created by the 27 department while in possession; and 28 (2) any transfer of trust company assets made after or in contemplation 29 of the trust company's insolvency or in anticipation of the department's takeover, with 30 intent to effect a preference of one creditor over another creditor or to prevent the 31 distribution of the trust company assets according to law, is void.
01 (d) The department may borrow money in the name of the trust company in 02 the department's possession and may pledge trust company assets as security for the 03 loan. 04 (e) All necessary and reasonable expenses resulting from the department's 05 possession of a trust company and of its reorganization or liquidation shall be paid 06 from trust company assets. 07 Sec. 06.26.770. Reorganization. (a) If the department decides to reorganize 08 a trust company, the department, after providing an opportunity for a hearing to all 09 interested parties, shall enter an order proposing a reorganization plan. The 10 department shall send a copy of the plan to each depositor and other customers and to 11 each creditor who will not receive payment of a claim in full under the plan and a 12 notice that, unless within 30 days the plan is disapproved in writing by persons 13 holding one-third or more of the aggregate amount of the claims, the department will 14 reorganize the trust company. 15 (b) A plan of reorganization may not be established under this chapter unless, 16 in the opinion of the department, 17 (1) the plan is fair to all classes of depositors, other customers, 18 creditors, and shareholders; 19 (2) subject to a fair adjustment for new capital that a class will pay 20 under the plan, the face amount of the trust company asset interest provided to a class 21 of depositors, other customers, creditors, or shareholders under the plan does not 22 exceed the value of the assets at liquidation less the full amount of the claims of all 23 prior classes; 24 (3) the plan provides for the issuance of common stock in an amount 25 that will provide an adequate ratio to deposits; 26 (4) any exchange of new common stock for obligations or stock of the 27 trust company will be made 28 (A) in the inverse order of the priorities in liquidation of the 29 classes that will retain an interest in the trust company; and 30 (B) upon terms that adjust in a fair manner any change in the 31 relative interest of the respective classes that will be produced by the
01 exchange; 02 (5) the plan assures the removal of a director, an officer, or an 03 employee responsible for a problem identified by the department, including an unsafe, 04 unsound, or unlawful action or the existence of an unsafe or unsound condition; 05 (6) any merger or consolidation provided by the plan complies with 06 this chapter. 07 (c) When in the course of reorganization, supervening conditions render a plan 08 of reorganization unfair or its execution impractical, the department may modify the 09 plan or liquidate the trust company. 10 Sec. 06.26.780. Involuntary liquidation powers. (a) When liquidating a 11 trust company, the department may exercise any power incidental to liquidating a trust 12 company, but it may not, without the approval of the superior court, 13 (1) sell trust company assets having an appraised value in excess of 14 $100,000; 15 (2) compromise or release a claim that exceeds $100,000 exclusive of 16 interest; 17 (3) make full payment on a claim, other than a claim upon an 18 obligation incurred by the department, before preparing and filing a schedule of the 19 department's determinations under AS 06.26.790(d)(3). 20 (b) Within six months after beginning the liquidation of a trust company, the 21 department may terminate an executory contract for services or advertising to which 22 the trust company is a party or an obligation of the trust company as a lessee. A lessor 23 who receives 60 days' notice of the department's decision to terminate a lease does not 24 have a claim for rent other than rent accrued to the date of termination or for damages 25 due to the termination. 26 (c) As soon as practical after beginning the involuntary liquidation of a trust 27 company, the department shall take the steps necessary to terminate all fiduciary 28 positions held by the trust company, to surrender all property held by the trust 29 company as a fiduciary, and to settle the trust accounts of the trust company. 30 Sec. 06.26.790. Claims. (a) As soon as practical after beginning the 31 liquidation of a trust company, the department shall
01 (1) mail a notice of the liquidation proceedings to the last known post 02 office address of each depositor, creditor, lessee of a safe deposit box, bailor of 03 property, and trustor and beneficiary of trust assets held by the trust company; 04 (2) post a notice of the proceedings conspicuously on the premises of 05 the trust company; and 06 (3) publish a notice that the department determines to be appropriate 07 for the proceedings. 08 (b) The department shall mail with the notice sent under (a)(1) of this section a 09 statement of the amount shown on the trust company's records to be the claim of the 10 depositor or creditor. The notice must also include a demand that a person who is 11 entitled to property held by the trust company as bailee or trustee or in a safe deposit 12 box of the trust company withdraw the property within 30 days. The notice must 13 direct those depositors and creditors who claim amounts different from the amounts in 14 the notice to file their claims with the trust company under the procedure described in 15 the notice and before a specified date. The specified day may not be less than 60 days 16 from the date of the first publication of the notice. 17 (c) A safe deposit box whose contents have not been removed within 30 days 18 after demand shall be opened. The department shall retain the contents of the box and 19 the other unclaimed property held by the trust company as bailee until the conclusion 20 of the liquidation proceedings. At the conclusion of the liquidation proceedings under 21 this section, the property held by the department under this subsection is considered 22 abandoned, and the department shall deliver the property to the Department of 23 Revenue under AS 34.45.110 - 34.45.780. 24 (d) Within six months after the last day specified in the notice for the filing of 25 claims, or within a longer period if allowed by the superior court, the department shall 26 (1) reject a claim that it determines to be invalid; 27 (2) determine the amount, if any, owing to each known creditor or 28 depositor and the priority class of the person's claim under this chapter; 29 (3) prepare a schedule of its determinations for filing in the superior 30 court; 31 (4) publish a notice in a newspaper once each week for three
01 successive weeks, of the times and places where the schedule of determinations will 02 be available for inspection and the date when the department will file its schedule in 03 court; the date may not be sooner than 30 days after the first publication. 04 (e) Within 30 days after the filing with the superior court of the department's 05 schedule under (d)(3) of this section, a creditor, depositor, or stockholder may file 06 with the court an objection to a determination. The court shall hear and determine the 07 filed objections after the notice to the department and interested claimants that the 08 court establishes. If the court sustains an objection, the court shall direct that the 09 schedule be modified appropriately. 10 (f) After filing its schedule, the department may make partial distribution to 11 the holders of the claims that are undisputed or are allowed by the court if an adequate 12 reserve is established for the payment of disputed claims. As soon as practicable after 13 the determination of all objections, the department shall make the final distribution. 14 (g) The following claims have priority in liquidation proceedings, in the order 15 listed: 16 (1) obligations incurred by the department in liquidating the trust 17 company; 18 (2) wages and salaries of officers and employees earned during the 19 three-month period preceding the department's possession in an amount not exceeding 20 $3,000 for each person; 21 (3) fees and assessments owed by the trust company to the department; 22 (4) deposits; 23 (5) claims secured by trust company assets. 24 (h) After the payment of all other claims, including interest at the rate of 10.5 25 percent a year, the department shall pay claims that are otherwise valid but that were 26 not filed within the time prescribed. 27 (i) If the sum available for a class of creditors is insufficient to provide 28 payment in full, the sum shall be distributed pro rata to the claimants in the class. 29 (j) Unclaimed property remaining after the completion of the liquidation 30 proceedings under this section is presumed abandoned, and the property shall be 31 delivered to the Department of Revenue for handling under AS 34.45.110 - 34.45.780.
01 (k) After payment of the expenses of the liquidation and the claims against the 02 trust company arising from its fiduciary obligations in this state under AS 06.26.760 - 03 06.26.800, the receiver shall distribute any remaining money or other assets from the 04 liquidation of the trust company's fiduciary operations in this state equitably among, as 05 applicable, the receivers for liquidation of the trust company's fiduciary operations in 06 other states of the United States and under the laws of the United States, for payment 07 of the expenses of liquidation and claims against the trust company's fiduciary 08 operations. If the trust company's fiduciary operations are not being liquidated in 09 another state or under the laws of the United States, the receiver shall, after satisfying 10 the requirements of AS 06.26.760 - 06.26.800, pay any remaining money or other 11 assets from the liquidation of the trust company's fiduciary operations in this state to 12 the trust company. 13 (l) When the receiver has completed the liquidation of the trust company's 14 fiduciary operations in this state, the receiver shall, with notice to the department, 15 petition the court for an order declaring the trust company's fiduciary operations in this 16 state properly wound up under AS 06.26.760 - 06.26.800. Upon the filing of the 17 petition, the court shall proceed as provided in AS 06.26.760 - 06.26.800. 18 (m) An order issued by the court under a petition filed under (l) of this section 19 may only declare the trust company's fiduciary operations in this state have been 20 properly wound up and may not declare the trust company is dissolved. The court 21 may make whatever additional orders and grant whatever additional relief that the 22 court determines is proper under the evidence submitted. 23 (n) After an order is issued under (m) of this section declaring the trust 24 company's fiduciary operations in this state are properly wound up, 25 (1) the trust company shall, except for any further winding up, cease 26 acting as a fiduciary in this state or in any jurisdiction; and 27 (2) the receiver shall promptly file with the department a copy of the 28 order certified by the clerk of the court. 29 Sec. 06.26.800. Federal Deposit Insurance Corporation as receiver or 30 liquidator. The department may appoint the Federal Deposit Insurance Corporation 31 or its successor as receiver for a trust company that the department has taken
01 possession of if the deposits of the trust company are insured by that corporation or its 02 successor. Upon filing with the court a certificate indicating the acceptance of the 03 appointment by the Federal Deposit Insurance Corporation or its successor, the 04 possession of and title to all the assets, business, and property of the trust company are 05 transferred to that corporation. The department is then relieved of all responsibility 06 and liability with respect to the reorganization or liquidation of the trust company. 07 The Federal Deposit Insurance Corporation or its successor may liquidate, reorganize, 08 merge, or consolidate the trust company in the manner permitted by the laws of the 09 United States or by this chapter, and possesses all the rights, powers, duties, and 10 obligations of the department in the liquidation, reorganization, merger, or 11 consolidation of the trust company under this chapter. 12 Article 11. Interstate State Trust Company, Interstate National 13 Trust Company, and International Trust Company Offices. 14 Sec. 06.26.810. Fiduciary operations at a branch or trust office. (a) An 15 interstate state trust company, interstate national trust company, or international trust 16 company may not act as a fiduciary in this state unless the trust company maintains a 17 trust office in this state as permitted under AS 06.26.810 - 06.26.895. 18 (b) If an interstate state trust company, interstate national trust company, or 19 international trust company establishes or acquires a trust office in this state under 20 AS 06.26.810 - 06.26.895, the trust company may conduct at the trust office any 21 activity that a trust company may conduct at a trust office under this chapter. 22 Sec. 06.26.820. Establishing or acquiring a trust office. If an interstate state 23 trust company, interstate national trust company, or international trust company that 24 does not operate a trust office in this state meets the requirements of AS 06.26.810 - 25 06.26.895, the trust company may establish a new trust office in this state or acquire a 26 trust office in this state that is in existence at the time of acquisition. 27 Sec. 06.26.830. Requirement of notice. To establish a new trust office or 28 acquire a trust office that is in existence at the time of acquisition in this state under 29 AS 06.26.810 - 06.26.895, an interstate state trust company, interstate national trust 30 company, or international trust company shall provide, or cause its home jurisdiction 31 regulator to provide, written notice of the proposed transaction to the department on or
01 after the date on which the trust company applies to its home jurisdiction regulator for 02 approval to establish or acquire the trust office. The trust company shall file with the 03 notice and maintain a copy of a resolution adopted by the board of the trust company 04 authorizing the establishment or acquisition of the office and shall pay the filing fee 05 established by the department by regulation. 06 Sec. 06.26.840. Conditions for approval. (a) An interstate state trust 07 company or international trust company may not establish or acquire a trust office in 08 this state under AS 06.26.810 - 06.26.895 unless 09 (1) the trust company confirms in writing to the department that, while 10 the trust company maintains a trust office in this state, the trust company will comply 11 with all applicable laws of this state, including, except where the context or this 12 section indicates otherwise, the provisions of this chapter applicable to trust 13 companies organized under this chapter; 14 (2) the trust company provides satisfactory evidence to the department 15 of compliance with the 16 (A) requirements for foreign corporations under AS 10.06; and 17 (B) applicable requirements of its home jurisdiction regulator 18 for establishing or acquiring and maintaining the office; 19 (3) the department, acting within 90 days after receiving notice under 20 AS 06.26.830, certifies to the home jurisdiction regulator that the requirements of 21 AS 06.26.810 - 06.26.895 have been met and the notice has been approved or, if 22 applicable, that any conditions imposed by the department under (b) of this section 23 have been satisfied; 24 (4) the department receives evidence from the trust company that the 25 department determines clearly demonstrates that the establishment or acquisition will 26 serve the public interest and well-being; the evidence must address the factors listed in 27 AS 06.26.090(b); and 28 (5) the department has received all required fees and the affidavit of 29 publication required by AS 06.26.100(b). 30 (b) An interstate state trust company or international trust company may begin 31 acting as a fiduciary at a trust office on the 91st day after the date that the department
01 receives the notice under (a) of this section for the trust office unless the department 02 specifies a different date. 03 (c) The department may extend the 90-day period of review provided by (a) of 04 this section if the department determines that the written notice raises issues that 05 require additional information or additional time for analysis by the department. If the 06 department extends the 90-day period of review, the trust company may establish the 07 trust office only after written approval by the department. 08 (d) The department may deny an interstate state trust company or international 09 trust company permission to establish or acquire the trust office if the department finds 10 that the trust company lacks sufficient financial resources to undertake the proposed 11 expansion without adversely affecting its safety or soundness or that the proposed trust 12 office would be contrary to the public interest. When acting on the notice provided 13 under (a) of this section, the department shall consider the views of the home 14 jurisdiction regulator. 15 (e) If an interstate state trust company or international trust company is not 16 required by AS 10.06 or another law of this state to maintain a registered agent in this 17 state, the trust company shall file a written consent with the department permitting the 18 commissioner to act as the agent for the trust company for service of process in a court 19 action arising out of or connected with the proposed trust office. 20 (f) An interstate national trust company may not establish or acquire a trust 21 office in this state unless the trust company provides satisfactory evidence to the 22 department of compliance with the applicable requirements of its home jurisdiction 23 regulator for establishing or acquiring and maintaining the office. 24 Sec. 06.26.850. Representative office business; registration. (a) An 25 interstate state trust company, interstate national trust company, or international trust 26 company may not provide fiduciary services, but may otherwise engage in trust 27 business, at a representative office as permitted by AS 06.26.810 - 06.26.895. 28 (b) Subject to the requirements contained in AS 06.26.810 - 06.26.895, an 29 interstate state trust company, interstate national trust company, or international trust 30 company may establish or acquire representative offices in any location in this state. 31 (c) If an interstate state trust company or international trust company that does
01 not maintain a trust office in this state wants to establish or acquire a representative 02 office in this state, the trust company shall file a notice with the department on a form 03 prescribed by the department. The trust company shall furnish a copy of a resolution 04 adopted by its board authorizing the establishment or acquisition of the representative 05 office and shall pay the filing fee established by the department by regulation. The 06 notice required under this subsection must provide the name of the trust company, the 07 location of the proposed representative office, and satisfactory evidence that the trust 08 company is chartered or otherwise organized in another jurisdiction to act as a 09 fiduciary. 10 (d) An interstate state trust company or international trust company may 11 commence business at a representative office on the 61st day after the date that the 12 department receives the notice required under (c) of this section unless the department 13 specifies a different date. 14 (e) The department may extend the 60-day period of review provided by (d) of 15 this section if the department determines that the written notice raises issues that 16 require additional information or additional time for analysis by the department. If the 17 60-day period of review is extended, the trust company may establish the 18 representative office only after written approval by the department. 19 (f) In addition to the other requirements of this section, in order to receive 20 permission to establish or acquire a representative office in this state, an interstate 21 state trust company or international trust company must have sufficient financial 22 resources to undertake the proposed expansion without adversely affecting its safety or 23 soundness and the proposed representative office may not be contrary to the public 24 interest. When acting on the notice provided under (c) of this section, the department 25 shall consider the views of the home jurisdiction regulator. 26 (g) The department may determine by order that an interstate state trust 27 company or international trust company does not meet the requirements for 28 establishing or acquiring a representative office in this state under this section. An 29 order issued under this subsection is effective on the date of its issuance or on another 30 date as the department may determine. 31 (h) An interstate national trust company shall give the department notice of its
01 intent to establish or acquire a representative office in this state. 02 Sec. 06.26.860. Additional trust offices. If an interstate state trust company 03 or international trust company maintains a trust office in this state under AS 06.26.810 04 - 06.26.895, the trust company may establish or acquire additional trust offices or 05 representative offices in this state to the same extent and in the same manner that a 06 trust company may establish or acquire branch offices in this state under the 07 procedures for establishing or acquiring branch offices under AS 06.26.160. 08 Sec. 06.26.870. Examinations; periodic reports; cooperative agreements; 09 assessment of fees. (a) When the department considers it necessary to protect the 10 public interest, the department or a competent person designated by the department 11 may examine an interstate state trust company or international trust company that has 12 a trust office or a representative office in the state. The trust company shall pay a fee 13 established under AS 06.01.010 for the examination. 14 (b) The department may require periodic reports from an interstate state trust 15 company or international trust company if the trust company maintains a trust office in 16 this state and from a bank holding company that controls the trust company. The 17 reports shall be made under oath and filed as frequently as required by the department. 18 The reports must contain the information and detail that the department determines to 19 be appropriate as required under regulations adopted by the department. 20 (c) If an interstate state trust company or international trust company 21 maintains a trust office or a representative office in this state, the trust company may 22 be assessed and, if assessed, shall pay supervisory and examination fees as required by 23 the laws of this state and regulations of the department. Fees may be shared with other 24 governmental regulators or any organization affiliated with or representing 25 governmental regulators under agreements between the department and the regulators 26 or organization. 27 Sec. 06.26.880. Enforcement. (a) Consistent with AS 06.01.030 and 28 regulations adopted by the department under AS 06.01.030 or this chapter, the 29 department may determine that 30 (1) an office maintained by an interstate state trust company or 31 international trust company is being operated in violation of a provision of the laws of
01 this state or in an unsafe and unsound manner; or 02 (2) an interstate state trust company or international trust company is 03 engaged in an activity that the trust company may not engage in under this chapter. 04 (b) If either of the conditions in (a) of this section exists, the department may 05 take the enforcement actions it would be empowered to take if the office or the 06 company were a trust company established under this chapter, including issuing an 07 order temporarily or permanently prohibiting the trust company from acting as a 08 fiduciary in this state. 09 (c) If a matter involves extraordinary circumstances that require immediate 10 action, the department may take any action permitted by this section without providing 11 notice or an opportunity for a hearing before taking the action. The department shall 12 promptly give notice to the home jurisdiction regulator of each enforcement action 13 taken against an interstate state trust company or international trust company and, to 14 the extent practicable, shall consult and cooperate with the home jurisdiction regulator 15 when pursuing and resolving an enforcement action. 16 Sec. 06.26.890. Notice of subsequent merger, consolidation, or closing. If 17 an interstate state trust company, interstate national trust company, or international 18 trust company maintains a trust office or a representative office in this state under this 19 chapter, the trust company shall give at least 60 days' prior written notice, or, in the 20 case of an emergency transaction, shorter notice that is consistent with applicable state 21 and federal law, to the department of 22 (1) a merger, consolidation, or other transaction that would cause a 23 change of control with respect to the trust company or any bank holding company that 24 controls the trust company if an application would be required to be filed under 12 25 U.S.C. 1817(j) (Change in Bank Control Act of 1978) or 12 U.S.C. 1841 - 1850 (Bank 26 Holding Company Act of 1956); 27 (2) a transfer of all or substantially all of the trust accounts or trust 28 assets of the trust company to another person; 29 (3) the closing or other disposition of any trust office of the trust 30 company in this state. 31 Sec. 06.26.895. Definitions. In AS 06.26.810 - 06.26.895,
01 (1) "international trust company" means an international trust company 02 whose home office is not located in this state; 03 (2) "interstate national trust company" means an interstate national 04 trust company whose home office is not located in this state; 05 (3) "interstate state trust company" means an interstate state trust 06 company whose home office is not located in this state. 07 Article 12. Miscellaneous Provisions. 08 Sec. 06.26.900. Powers of department. The department may 09 (1) exercise general supervision over trust companies, interstate trust 10 companies, and international trust companies, and the subsidiaries and affiliated 11 corporations of trust companies, interstate state trust companies, and international trust 12 companies; 13 (2) in addition to other authority in this chapter to adopt regulations, 14 adopt regulations necessary to interpret and implement this chapter, including 15 regulations providing for the retention and preservation of records; 16 (3) review and approve or disapprove applications for trust companies 17 under AS 06.26.090, trust company branch offices under AS 06.26.160, representative 18 offices under AS 06.26.170, and trust offices and representative offices under 19 AS 06.26.810 - 06.26.895; 20 (4) issue permits authorizing trust company holding companies to do 21 business in this state; 22 (5) determine for each trust company the amount of paid-in capital 23 necessary to operate under AS 06.26.120; 24 (6) review and approve transfers of trust company ownership under 25 AS 06.26.450; 26 (7) perform examinations of trust companies, branch offices, 27 representative offices, subsidiaries of trust companies, private trust companies, and 28 subsidiaries of private trust companies under AS 06.01.015 and this chapter; 29 (8) relieve a trust company from the examination requirements of 30 AS 06.01.015 if the trust company's deposits are insured by the Federal Deposit 31 Insurance Corporation, a successor of the Federal Deposit Insurance Corporation, or
01 another agency of the United States that insures trust company deposits; 02 (9) approve under AS 06.26.190 the operation of a branch trust 03 company on a schedule different than normal banking days; 04 (10) approve the operation by a trust company of an automated teller 05 machine in accordance with AS 06.05; 06 (11) approve certain trust company subsidiaries; 07 (12) approve the acceptance by a trust company of the trust company's 08 stock or of the stock of the trust company's holding company as security for a loan 09 under circumstances approved by the department; 10 (13) restrict the withdrawal of deposits from a trust company if the 11 department finds that extraordinary circumstances make restriction necessary for the 12 proper protection of depositors; 13 (14) require a trust company to 14 (A) maintain its capital and reserve accounts in amounts 15 determined appropriate by the department; 16 (B) observe the methods and standards that the trust company 17 adopts for determining the value of various types of assets; 18 (C) charge off part or all of an asset that has not been lawfully 19 acquired; 20 (D) write down an asset to its market value; 21 (E) record liens and other interests in property; 22 (F) obtain a financial statement from a borrower or prospective 23 borrower to the extent that the trust company can obtain the statement; 24 (G) obtain insurance against damage to real property taken as 25 security; 26 (H) search or obtain insurance on the title to real property taken 27 as security; 28 (I) maintain adequate insurance against risks as the department 29 determines necessary and appropriate for the protection of depositors and the 30 public; 31 (J) charge off that portion of an asset classified as a loss, or
01 charge off or reserve up to 50 percent of loans classified as doubtful, in a state 02 or federal report of examination; or 03 (K) charge off all debts owed to the trust company in which 04 interest is past due and unpaid for a period of six months, unless the debt 05 principal is adequately secured and the trust company is in the process of 06 collection; 07 (15) require the board of directors of a trust company to hold a meeting 08 under AS 06.26.520; 09 (16) order the removal of a board member of a trust company under 10 AS 06.26.510; 11 (17) order a trust company to suspend the payment of dividends under 12 AS 06.26.120 and regulations adopted by the department; 13 (18) require a trust company to increase its capital accounts under 14 AS 06.26.120; 15 (19) take possession of a trust company in the manner provided in 16 AS 06.26.730 - 06.26.750, and operate, reorganize, or liquidate the trust company after 17 taking possession; 18 (20) issue an order under AS 06.01.030 that the department determines 19 is necessary to ensure compliance with this chapter; and 20 (21) exercise other powers expressly or implicitly granted under this 21 chapter. 22 Sec. 06.26.905. Cooperative agreements. (a) The department may enter into 23 cooperative, coordinating, or information-sharing agreements with other governmental 24 regulators or with an organization affiliated with or representing governmental 25 regulators to handle the periodic examination or other supervision of a trust office that 26 is located in this state and owned by an interstate state trust company or of a trust 27 office that is located in a host state and owned by a trust company. Under the 28 agreements, the department may accept reports of examination and reports of 29 investigation instead of conducting the department's own examinations or 30 investigations. 31 (b) The department may enter into joint enforcement action agreements with
01 other governmental regulators having concurrent jurisdiction over a trust company that 02 is located in this state and owned by an interstate state trust company organized in 03 another state or over a trust office that is located in a host state and owned by a trust 04 company. 05 (c) Notwithstanding the existence of an agreement under this section, the 06 department may at any time make an examination or take independent supervisory or 07 enforcement action if the department determines that the examination or action is 08 necessary or appropriate to carry out the department's responsibilities under this 09 chapter or to ensure compliance with the laws of this state. 10 Sec. 06.26.910. Appeals. (a) A person may appeal to the department 11 (1) a denial of an application under AS 06.26.090(e); 12 (2) an order under AS 06.26.120 to increase or adjust capital; 13 (3) a denial under AS 06.26.150 of a change of the location of a home 14 office under AS 06.26.150; 15 (4) a denial under AS 06.26.160 of permission for a trust company to 16 establish a branch office; 17 (5) a denial under AS 06.26.170 of permission to establish or acquire 18 a representative office; 19 (6) a denial under AS 06.26.180(d) of permission to establish an office 20 outside this state; 21 (7) a denial of a private trust company exemption under AS 06.26.200 22 and 06.26.210; 23 (8) the conditions or limitations established for an exemption under 24 AS 06.26.200(e); 25 (9) the revocation of an exemption under AS 06.26.230; 26 (10) a denial of permission for a private trust company to convert to a 27 trust company under AS 06.26.240; 28 (11) a denial under AS 06.26.470 of an application to acquire control 29 of a trust company; 30 (12) the disapproval under AS 06.26.650 of a conversion, merger, or 31 consolidation;
01 (13) a denial under AS 06.26.840(d) of permission to establish or 02 acquire a trust office in this state; 03 (14) a denial under AS 06.26.850(g) of permission to establish or 04 acquire a representative office in this state; and 05 (15) a denial under AS 06.26.860 of permission for additional trust 06 offices or representative offices. 07 (b) The department shall adopt regulations, consistent with the provisions of 08 this chapter, establishing the procedures for appeals allowed under (a) of this section. 09 (c) The provisions of AS 44.62 (Administrative Procedure Act), including 10 judicial review under AS 44.62.560, apply to an appeal under this chapter to the extent 11 the provisions of AS 44.62 do not conflict with the procedures established under (b) of 12 this section or other provisions of this chapter. 13 Sec. 06.26.920. Civil enforcement. The department may bring any 14 appropriate civil court action against a person who the department determines has 15 committed or is about to commit a violation of this chapter. 16 Sec. 06.26.930. Trust company reports to the department; publication of 17 reports. (a) A trust company shall make at least four reports of its condition each 18 year to the department as required by and on forms prescribed by the department. 19 Each report shall be signed by a duly authorized officer of the trust company verified 20 by at least one independent director, and each verifying director shall certify under 21 oath that the director has personal knowledge of the facts stated in the report and that 22 the facts are true. Each report must exhibit in detail and under appropriate headings 23 the resources and liabilities of the trust company and must be received by the 24 department within 30 calendar days after the end of the period covered by the report. 25 (b) The department may require that a trust company submit special reports 26 whenever the department considers a report necessary in order to obtain full 27 knowledge of the trust company's condition. 28 (c) In addition to the other reports required by this section, a trust company 29 shall make at least one report of income and dividends to the department each year. 30 The trust company shall submit the report to the department within 30 calendar days 31 after the end of the calendar or fiscal year covered by the report.
01 (d) All of the reports of condition required by this section shall be made 02 available to all customers on request and at no charge to the customer. 03 Sec. 06.26.940. Remedy of person damaged by violation. In addition to any 04 other remedies available under law to the person, a person who suffers damages as a 05 result of a violation of this chapter by a person subject to this chapter may bring an 06 action in court against the person violating this chapter to recover the damages. In this 07 section, "person subject to this chapter" means a trust company, a private trust 08 company, an exempt private trust company, a person who is required to obtain a 09 certificate of authority under AS 06.26.090, and an interstate state trust company or 10 international trust company. 11 Sec. 06.26.950. Limitation on powers. This chapter does not allow a trust 12 company to engage in banking. 13 Article 13. General Provisions. 14 Sec. 06.26.960. Application of laws relating to general business 15 corporations. (a) Unless expressly authorized by this chapter, a trust company may 16 not take an action that is authorized by AS 10.06 regarding its corporate status, capital 17 structure, or a matter of corporate governance and for which AS 10.06 requires a filing 18 with the department unless the trust company first makes the required filing with the 19 department and receives the department's approval. 20 (b) The department may adopt regulations to alter or supplement the 21 procedures and requirements of AS 10.06 applicable to an act taken under this chapter 22 by a trust company. 23 Sec. 06.26.990. Definitions. (a) In this chapter, unless the context otherwise 24 requires, 25 (1) "banking" has the meaning given in AS 06.05.990; 26 (2) "board" means board of directors; 27 (3) "certificate of authority" means the certificate of authority issued to 28 a corporation under AS 06.26.110; 29 (4) "chapter" includes regulations adopted under this chapter; 30 (5) "commissioner" means the commissioner of community and 31 economic development;
01 (6) "customer" means a person using the services of a trust company or 02 a private trust company, and includes a depositor; 03 (7) "department" means the Department of Community and Economic 04 Development; 05 (8) "depository" means a person authorized by state or federal law to 06 accept deposits of trust assets; 07 (9) "exempt private trust company" means a private trust company that 08 has received an exemption under AS 06.26.200; 09 (10) "family member" means an individual who is related, including 10 relation established by adoption, within the fourth degree by blood or marriage, to the 11 individual whom the relationship is measured; 12 (11) "fiduciary" means a person to whom the property of another 13 person is entrusted for a purpose specified in a trust instrument or by a court order; 14 (12) "fiduciary operations" means operations performed by a fiduciary; 15 (13) "fiduciary services" means services of a fiduciary; 16 (14) "financial institution" has the meaning given in AS 06.05.990; 17 (15) "governmental regulator" means a governmental agency 18 responsible for regulating persons who act as fiduciaries; 19 (16) "home jurisdiction regulator" means the governmental agency 20 responsible for regulating an interstate state trust company, interstate national trust 21 company, or international trust company in the jurisdiction where the trust company is 22 chartered or otherwise organized; 23 (17) "insider" has the meaning given in 12 C.F.R. 215.2; 24 (18) "international trust company" means an organization that provides 25 fiduciary services and has offices in countries other than the country in which the 26 home office of the entity is located; 27 (19) "interstate national trust company" means an organization 28 (A) that is chartered as a bank by the United States; 29 (B) whose powers are limited to providing fiduciary services; 30 and 31 (C) that has offices in a state of the United States other than the
01 state in which the home office of the organization is located; 02 (20) "interstate state trust company" means an organization that 03 (A) provides fiduciary services; 04 (B) holds a charter, license, certificate, or other type of 05 authorization from this or another state of the United States that authorizes the 06 organization to provide fiduciary services; and 07 (C) has offices in a state of the United States other than the 08 state in which the home office of the organization is located; 09 (21) "issuer" has the meaning given in AS 45.55.990; 10 (22) "national bank" has the meaning given in AS 06.05.990; 11 (23) "offer fiduciary services to the general public" means to advertise 12 fiduciary services, solicit fiduciary services work, or market fiduciary services in any 13 medium, including an electronic medium, regardless of whether a fee, commission, or 14 any other type of remuneration is charged or received; 15 (24) "personal representative" has the meaning given in AS 13.06.050; 16 (25) "private trust company" means a person who acts as a fiduciary, is 17 not exempt under AS 06.26.020(a) or (c), and qualifies under AS 06.26.200(c); 18 (26) "purchasing trust company" means a trust company purchasing all 19 or substantially all of the assets of another trust company; 20 (27) "representative office" means an office that provides support 21 services for a trust company, but at which the trust company does not provide 22 fiduciary services; 23 (28) "resident of this state" means an individual who is physically 24 present in Alaska and who intends to remain indefinitely in Alaska; 25 (29) "selling trust company" means a trust company selling all or 26 substantially all of its assets; 27 (30) "state bank" has the meaning given in AS 06.05.990; 28 (31) "state financial institution" means an institution organized under 29 this title if the deposits of the institution are insured by an agency of the federal 30 government; 31 (32) "trust account" means an account at a trust company for trust
01 assets; 02 (33) "trust assets" means assets held in trust for another person; 03 (34) "trust company" means a person who is organized under this 04 chapter to act as a fiduciary and to provide fiduciary services to the general public; 05 (35) "trust company assets" means assets that are not trust assets and 06 that are owned by a trust company; 07 (36) "trust holding company" means an organization formed for the 08 purpose of owning a trust company; 09 (37) "trust office" means an office that provides fiduciary services; 10 (38) "within the fourth degree" means a child, a grandchild, a great- 11 grandchild, a parent, a sister, a brother, a niece, a nephew, a grandniece, a 12 grandnephew, a grandparent, an aunt, an uncle, a first cousin, a great-grandparent, a 13 great-aunt, a great-uncle, and a great-great-grandparent. 14 (b) In AS 06.26.220, 06.26.450 - 06.26.470, 06.26.510, 06.26.860, and 15 06.26.880, "control" means owning, or holding with the power to vote, 25 percent or 16 more of the voting securities or other capital stock. 17 Sec. 06.26.995. Short title. This chapter may be cited as the Revised Alaska 18 Trust Company Act. 19 * Sec. 3. AS 13.36.025 is amended by adding a new subsection to read: 20 (b) The provisions of (a) of this section are not intended to override any 21 provision of AS 06.26, and AS 06.26 governs to the extent of any conflict. 22 * Sec. 4. AS 13.36.320(a) is amended to read: 23 (a) If at least one qualified person serves as trustee of a trust whose state 24 jurisdiction provision is valid, effective, and conclusive under AS 13.36.035(c), then 25 the following persons also may serve as trustees even though they are not qualified 26 persons: 27 (1) individuals who do not reside in the state [ALASKA]; 28 (2) trust companies that have their principal place of business outside 29 the state [OF ALASKA] and that are not organized under AS 06.26 [AS 06.25]; and 30 (3) banks that have their principal place of business outside the state 31 [OF ALASKA] or that are not organized under AS 06.05.
01 * Sec. 5. AS 13.36.390(2) is amended to read: 02 (2) "qualified person" means 03 (A) an individual who, except for brief intervals, military 04 service, attendance at an educational or training institution, or for absences for 05 good cause shown, resides in this state, whose true and permanent home is in 06 this state, who does not have a present intention of moving from this state, and 07 who has the intention of returning to this state when away; 08 (B) a trust company that is organized under AS 06.26 09 [AS 06.25] and that has its principal place of business in this state; or 10 (C) a bank that is organized under AS 06.05, or a national 11 banking association that is organized under 12 U.S.C. 21 - 216d, if the bank or 12 national banking association possesses and exercises trust powers and has its 13 principal place of business in this state; 14 * Sec. 6. AS 21.66.250 is amended to read: 15 Sec. 21.66.250. Trust funds. Except as provided in AS 34.80, trust funds or 16 assets held in a fiduciary capacity by a title insurance company that is authorized to do 17 a trust business shall be invested in accordance with AS 06.26 [AS 06.25]. 18 * Sec. 7. AS 34.77.100(a) is amended to read: 19 (a) An arrangement is a community property trust if one or both spouses 20 transfer property to a trust, the trust expressly declares that some or all the property 21 transferred is community property under this chapter, and at least one trustee is a 22 qualified person whose powers include or are limited to maintaining records for the 23 trust on an exclusive or a nonexclusive basis and preparing or arranging for the 24 preparation of, on an exclusive or a nonexclusive basis, any income tax returns that 25 must be filed by the trust. A community property trust is enforceable without 26 consideration. Both spouses or either spouse may be a trustee. The trust must be 27 signed by both spouses. In this subsection, "qualified person" means 28 (1) an individual 29 (A) who, except for brief intervals, military service, attendance 30 at an educational or training institution, or absences for good cause shown, 31 resides in this state;
01 (B) whose true and permanent home is in this state; 02 (C) who does not have a present intention of moving from this 03 state; and 04 (D) who intends to return to this state when away; 05 (2) a trust company that is organized under AS 06.26 [AS 06.25] and 06 that has its principal place of business in this state; or 07 (3) a bank that is organized under AS 06.05 or a national banking 08 association that is organized under 12 U.S.C. 21 - 216d if the bank or national banking 09 association possesses and exercises trust powers and has its principal place of business 10 in this state. 11 * Sec. 8. AS 06.25.010, 06.25.020, 06.25.030, 06.25.040, 06.25.050, 06.25.080, 06.25.085, 12 06.25.090, 06.25.100, 06.25.105, 06.25.110, 06.25.120, 06.25.130, 06.25.140, 06.25.150, 13 06.25.160, 06.25.170, 06.25.180, 06.25.190, 06.25.200, 06.25.210, 06.25.215, 06.25.220, 14 06.25.230, 06.25.240, 06.25.255, 06.25.260, 06.25.270, 06.25.280, 06.25.290, 06.25.300, 15 06.25.310, 06.25.315, and 06.25.350 are repealed. 16 * Sec. 9. The uncodified law of the State of Alaska is amended by adding a new section to 17 read: 18 COURT RULE CHANGES. (a) AS 06.26.020(d), enacted by sec. 2 of this Act, 19 amends Rules 7.2 and 7.3, Alaska Rules of Professional Conduct, by prohibiting certain 20 advertising and solicitation by certain exempt attorneys and their law firms. 21 (b) AS 06.26.760(b)(2), enacted by sec. 2 of this Act, amends 22 (1) Rule 6, Alaska Rules of Civil Procedure, by postponing the deadlines for 23 the filing of pleadings and other documents by a trust company in a civil action when the 24 Department of Community and Economic Development has taken possession of the trust 25 company; 26 (2) Rule 12, Alaska Rules of Civil Procedure, by postponing the deadlines for 27 serving an answer to a complaint, a third-party answer, a reply to a counterclaim, a cross- 28 claim, and an answer to a cross-claim by a trust company in a civil action when the 29 Department of Community and Economic Development has taken possession of the trust 30 company; 31 (3) Rule 40, Alaska Rules of Criminal Procedure, by postponing the deadlines
01 set in the Alaska Rules of Criminal Procedure for the filing of documents by a trust company 02 in a criminal action when the Department of Community and Economic Development has 03 taken possession of the trust company; 04 (4) Rule 204, Alaska Rules of Appellate Procedure, by postponing the 05 deadlines for the filing of appeals to the supreme court and the court of appeals by a trust 06 company when the Department of Community and Economic Development has taken 07 possession of the trust company; 08 (5) Rule 403, Alaska Rules of Appellate Procedure, by postponing the 09 deadline for the filing of petitions for review or cross-petitions for review by a trust company 10 when the Department of Community and Economic Development has taken possession of the 11 trust company; 12 (6) Rule 502, Alaska Rules of Appellate Procedure, by postponing the 13 deadlines set in the Alaska Rules of Appellate Procedure for the filing of documents by a trust 14 company when the Department of Community and Economic Development has taken 15 possession of the trust company; 16 (7) Rule 602, Alaska Rules of Appellate Procedure, by postponing the 17 deadlines for the filing of appeals to the superior court from a district court or an 18 administrative agency by a trust company when the Department of Community and Economic 19 Development has taken possession of the trust company; 20 (8) Rule 611, Alaska Rules of Appellate Procedure, by postponing the 21 deadlines set in the Alaska Rules of Appellate Procedure for the filing of petitions for review 22 to the superior court from a district court of an administrative agency by a trust company 23 when the Department of Community and Economic Development has taken possession of the 24 trust company. 25 * Sec. 10. The uncodified law of the State of Alaska is amended by adding a new section to 26 read: 27 TRANSITION. (a) The certificate of authority of a trust company incorporated under 28 former AS 06.25 before January 1, 2003, remains in effect until the department either issues 29 the trust company an amended certificate of authority under (c) of this section or revokes the 30 certificate of authority issued under former AS 06.25 under (d) of this section. 31 (b) An existing trust company shall, before April 1, 2003, submit to the department, if
01 the capital of the trust company 02 (1) meets the minimum capital requirements, a request that the department 03 issue the trust company an amended certificate of authority; the request must be accompanied 04 by 05 (A) a statement signed under oath by an officer of the trust company 06 that the capital of the trust company meets the minimum capital requirements; and 07 (B) a copy of a balance sheet for the trust company showing that the 08 capital of the trust company meets the minimum capital requirements; or 09 (2) does not meet the minimum capital requirements, a plan acceptable to the 10 department to meet the minimum capital requirements before January 1, 2007, and a request 11 that the department issue the trust company an amended certificate of authority. 12 (c) Notwithstanding AS 06.26.110(a), enacted by sec. 2 of this Act, upon satisfaction 13 of the requirements of (b)(1) or (2) of this section by an existing trust company, the 14 department shall issue the trust company an amended certificate of authority under AS 06.26, 15 enacted by sec. 2 of this Act. 16 (d) The department may revoke the certificate of authority issued to an existing trust 17 company under former AS 06.25 if the trust company fails to comply with the submittal 18 requirements of (b) of this section that apply to the trust company. 19 (e) If the department issues, under (c) of this section, an amended certificate of 20 authority to an existing trust company that submitted a plan under (b)(2) of this section, the 21 department may revoke the amended certificate of authority if the trust company fails to meet 22 the minimum capital requirements before January 1, 2007. 23 (f) In this section, 24 (1) "department" means the Department of Community and Economic 25 Development; 26 (2) "existing trust company" means a trust company that has a certificate of 27 authority issued under former AS 06.25 before January 1, 2003; 28 (3) "minimum capital requirements" means the minimum capital requirements 29 under AS 06.26.120(a), enacted by sec. 2 of this Act. 30 * Sec. 11. The uncodified law of the State of Alaska is amended by adding a new section to 31 read:
01 TRANSITION: REGULATIONS. The Department of Community and Economic 02 Development may proceed to adopt regulations necessary to implement the changes made by 03 secs. 1 - 8 of this Act. The regulations take effect under AS 44.62 (Administrative Procedure 04 Act), but not before January 1, 2003. 05 * Sec. 12. Sections 10 and 11 of this Act take effect immediately under AS 01.10.070(c). 06 * Sec. 13. Except as provided in sec. 12 of this Act, this Act takes effect January 1, 2003.