Nature of trust

1. Treasury
And
Trust
Operation

2. Nature of Trust

3. Creator of Trust
• Trustor
• Grantor
• Donor
• Testator
Trustee Beneficiary

4. Bank’s Trust Department

5. Legal Estate Administration,
Guardianship, and Administering Trust
This division would handle
matters of legal import,
manage and administer
properties under trust, act as
executor of last wills and
testaments, or administer
estates.

6. Agency Services
This division handles
agency services such
as that of safekeeping,
custodianship and
escrows.

7. Accounting Division
This division takes
care of recording
and analyzing all
trust transaction.

8. Asset Management Division
This division manages
outstanding and
foreclosed accounts of
both institutional and
individual clients.

9. Fund Management or Investment
Division
This division is in
charge of coming up
with products and
services offered to its
diverse clientele.

10. Trust Activities of Banks

11. To act as trustee for a corporation’s
assets under mortgages/ bond issue
In a corporate mortgage,
the trustee is charged with
the responsibility of
protecting the
mortgagees’ or
bondholders’ interest.

12. To act as transfer agent or
registrar of stocks and bonds
The transfer of ownership
of stocks and bonds
necessitates an accurate
record to protect the
interest of the owners.

13. To act as guardian of a
minor’s interest
When the property of a minor,
through a will or through
court order, is left in the
hands of bank trustees, it
sees to it that such interest
are safeguarded and are
properly managed.

14. To act as executor of last wills
and testaments
When the trustor
leaves a will, banks
assist in the
execution of the last
will and testaments.

15. To act as
administrator of estates
Sometimes, the owner of
the property or the court
appoint a trustees to take
over the management and
administration of his
estate.

16. To act as depository for escrow deposits,
valuables, or other securities
In some transactions, one
party may require the
other party to deposit in
escrow property or cash
to insure the performance
of an obligation.

17. To act as assignee, receiver, or
depository
In case of corporation or
individual businesses which are
on the brink of bankruptcy or
are being mismanaged, it may
be necessary for a third party to
take over management to insure
the interest of the creditors.

18. To act as an advisor
The trust department
provides expert advice
to institutions and
individuals in
investment decisions.

19. Kind of Trust

20. Individual Trust
Are those which would
pertain to trust functions
where the welfare and
interest of the individual is
safeguarded.

21. Voluntary or Living Trust
Under this set-up, the owner
transfers the title of the
property to a trustee and
gives instructions on how to
dispose of the income or how
to reinvest the funds.

22. Testamentary Trust
When an individual
appoints a trustee
through a will.

23. Insurance Trust
This services is rendered
whenever the trust
department of the bank is
appointed as trustee
under insurance trust
agreements.

24. Employee Benefit Trust
This involves the creation
and design of a plan to
provide economic security
and benefits to
employees.

25. Example:
• Fixed Benefit
• Variable Benefits
• Profit-sharing Fund
• Stock Bonus Fund

26. Investment Management
Services
Banks manage investment
portfolios. It allows clients’
assets to grow in a
disciplined manner according
to their goals, time frame and
comfort level.

27. Collateral Trust
In this case, the title of the
collaterals placed behind
a mortgage is transferred
to a trustee for the interest
of the bondholders.

28. Sinking Fund Trust
The trustee is usually
assigned to enforce the
provisions for a sinking
fund connected with bond
financing.

29. Why Banks
Make Better Trustees?

30. Why Banks
Make Better Trustees?

31. Advantages of Agency Services

32. Regulations of Trust Companies

33. Section 79
Authority to Engage
in Trust Business

34. Section 80
Conduct of
Trust Business

35. Section 81
Registration of Article
of Incorporation and
By-Law of a Trust
Entity

36. Section 82
Minimum
Capitalization

37. Section 83
Power of a Trust Entity

38. Section 84
Depositor for the
Faithful Performance
of Trust Duties

39. Section 85
Bond of Certain
Persons for the
Faithful Performance
of Duties

40. Section 86
Exemption of The
Trust Entity from Bond
Requirement

41. Section 87
Separation of Trust
Business from General
Business

42. Section 88
Investment Limitations
of a Trust Entity

43. Section 89
Real Estate Acquired
by a Trust Entity

44. Section 90
Investment of
Non-Trust Funds

45. Section 91
Sections
and
Penalties

46. Section 92
Exemptions of Trust
Assets from Claims

47. Section 93
Establishment of
Branches of a Trust
Entity