Section 412:8-301 - Permitted investments of capital and surplus(a) To the extent specified herein, a trust company may invest its own assets in: (1) Securities and obligations of the United States government and any agency of the United States government whose debt obligations are fully and explicitly guaranteed as to the timely payment of principal and interest by the full faith and credit of the United States, including without limitation Federal Reserve Banks, the Government National Mortgage Association, the Department of Veterans Affairs, the Federal Housing Administration, the United States Department of Agriculture, the Export-Import Bank, the Overseas Private Investment Corporation, the Commodity Credit Corporation, and the Small Business Administration;(2) Bonds, notes, mortgage backed securities, and other debt obligations of the Federal Home Loan Mortgage Corporation, the Federal National Mortgage Association, and the Federal Home Loan Banks;(3) Securities and obligations of United States government-sponsored agencies which are originally established or chartered by the United States government to serve public purposes specified by the Congress but whose debt obligations are not explicitly guaranteed by the full faith and credit of the United States, including without limitation Banks for Cooperatives, Federal Agricultural Mortgage Corporation, Federal Farm Credit Banks, Federal Intermediate Credit Banks, Federal Land Banks, Financing Corporation, Resolution Funding Corporation, Student Loan Marketing Association, Tennessee Valley Authority, the United States Postal Service, and securities and obligations of the Federal Home Loan Mortgage Corporation, the Federal National Mortgage Association, and the Federal Home Loan Banks that are not bonds, notes, mortgage backed securities, or other debt obligations of the Federal Home Loan Mortgage Corporation, the Federal National Mortgage Association, and the Federal Home Loan Banks; provided that the total amount invested in obligations of any one issuer shall not exceed twenty per cent of the trust company's capital and surplus; and(4) Securities and obligations of quasi-United States governmental institutions, including without limitation the International Bank for Reconstruction and Development (World Bank), the Inter-American Development Bank, the Asian Development Bank, the African Development Bank, the European Investment Bank, and other multilateral lending institutions or regional development institutions in which the United States government is a shareholder or contributing member; provided that the total amount invested in obligations of any one issuer shall not exceed twenty per cent of the trust company's capital and surplus.(b) A trust company may invest its own assets in bonds, securities, or similar obligations issued by this State or any county of this State, through an appropriate agency or instrumentality.(c) To the extent specified herein, a trust company may invest its own assets in bonds or similar obligations issued by any state of the United States other than this State, the District of Columbia, or any territory or possession of the United States, by municipal governments of such states, territories or possessions or by any foreign country or political subdivision of such country; provided, that: (1) The bond, note, or warrant has been issued in compliance with the constitution and laws of any such government;(2) There has been no default in payment of either principal or interest on any of the general obligations of such government for a period of five years immediately preceding the date of the investment; and(3) The total amount invested in such obligations of any one issuer by a trust company shall not exceed twenty per cent of the trust company's capital and surplus.(d) To the extent specified herein, a trust company may invest its own assets in capital stock, notes, bonds, and other obligations of any corporation which at the time of the investment is incorporated under the laws of the United States or any state or territory thereof or the District of Columbia; provided, that the aggregate amount invested by a trust company under this subsection and subsection (e) in any one corporation shall not exceed twenty per cent of the trust company's capital and surplus.(e) To the extent specified herein, a trust company may invest its own assets in securities of an investment grade. The term "investment grade" means notes, bonds, certificates of interest or participation, beneficial interests, mortgage or receivable-related securities, and other obligations that are commonly understood to be of investment grade quality, including without limitation those securities that are rated within the four highest grades by any nationally-recognized rating service or unrated securities of similar quality as reasonably determined by the trust company in its prudent judgment (which may be based in part upon estimates which it believes to be reliable). Investment grade does not include investments which are predominantly speculative in nature. The aggregate amount invested by a trust company under this subsection and subsection (d) in any one company or other issuer shall not exceed twenty per cent of the trust company's capital and surplus.(f) To the extent specified herein, a trust company may purchase, hold, convey, sell or lease real or personal property as follows:(1) The real property in or on which the business of the trust company is carried on, including its corporate offices, other space in the same property to rent as a source of income; permanent or vacation residences or recreational facilities for its officers and employees; other real property necessary to the accommodation of the trust company's business, including but not limited to parking facilities, data processing centers, and real property held for future corporate use where the trust company in good faith expects to utilize the property as trust company premises; provided, if the trust company ceases to use any real property and improvements thereon for one of the foregoing purposes, it shall, within five years thereafter, sell the real property or cease to carry it or them as an asset; provided further, such property shall not without the approval of the commissioner exceed seventy-five per cent of the trust company's capital and surplus;(2) Personal property used in or necessary to the accommodation of the trust company's business, including but not limited to furniture, fixtures, equipment, vaults and safety deposit boxes. The trust company's investment in furniture and fixtures shall not without the approval of the commissioner exceed twenty-five per cent of the trust company's capital and surplus. Any trust company acquiring any real property in any manner other than provided in this section shall immediately, upon receiving notice from the commissioner, charge the same to profit and loss, or otherwise remove the same from assets, and when any loss impairs the capital and surplus of the trust company the impairment shall be made good in the manner provided in this chapter.
Amended by L 2017, c 12,§ 1, eff. 4/26/2017.L 1993, c 350, pt of §1; am L 1997, c 258, §17; am L 2001, c 170, §10; am L 2009, c 107, §5 .