Code of Virginia

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Code of Virginia
Title 6.2. Financial Institutions and Services
Chapter 10. Entities Conducting Trust Business
11/29/2021

§ 6.2-1059. Substitution of subsidiary bank as fiduciary.

A. Upon obtaining permission to engage in the trust business, a subsidiary bank may file an application in the circuit court of the jurisdiction in which its main office is located requesting that it be substituted, except as may be specified in such application, in every fiduciary capacity for a bank under common ownership or a trust subsidiary under common ownership.

B. Upon a finding that (i) the subsidiary bank has been granted such permission to engage in the trust business by the Commission or the Comptroller of the Currency and (ii) the unimpaired capital and surplus of such subsidiary bank is sufficient as prescribed in § 6.2-1003, or bond with corporate surety has been posted for any excess, or has been validly waived, the court shall enter an order substituting the subsidiary bank in every fiduciary capacity for each of the specified banks or trust subsidiaries under common ownership, except as may be otherwise specified in the application.

C. Upon entry of such order, such subsidiary bank shall, without further act, be substituted in every such fiduciary capacity. The substitution shall be evidenced by filing a copy of the order with the clerk of any circuit court in the Commonwealth. The order shall be indexed in each index in the records of such court in which substitutions of fiduciaries are otherwise indexed. The application may be made ex parte and need not list the fiduciary capacities in which substitution is made. If a bank or trust subsidiary under common ownership with the subsidiary bank shall already have qualified in any fiduciary capacity and given bond, without surety, then if the order of substitution shall so provide, which it may provide only if the fiduciary for which there is to be substitution consents, the predecessor fiduciary shall remain liable on its bond for the acts of its named successor, and no security or corporate surety shall be required of the successor fiduciary on its bond.

D. Any bond, with corporate surety, posted under this section or under § 6.2-1056 may be a blanket bond conditioned as otherwise contemplated by law.

E. Each designation in a will or other instrument heretofore or hereafter executed of a bank or trust subsidiary as fiduciary shall be deemed a designation of the subsidiary bank substituted for such bank or trust subsidiary pursuant to this section except when the instrument is executed after such substitution and expressly negates the application of this section. No waiver of surety with respect to any fiduciary bond shall be effective except in such case when the bond would be otherwise sufficient as contemplated by § 6.2-1056 or this section. Any grant in such an instrument of any discretionary power shall be deemed conferred upon the fiduciary deemed to have been nominated hereunder.

F. A bank or trust subsidiary shall account jointly with the subsidiary bank that has been substituted as fiduciary for such bank or trust subsidiary pursuant to this section for the accounting period during which the subsidiary bank is initially so substituted. Upon substitution pursuant to this section, the bank or trust subsidiary shall deliver to the substituted subsidiary bank all assets held by the bank or trust subsidiary as fiduciary, except assets held for accounts to which there has been no substitution. Upon such substitution, all such assets shall become the property of the subsidiary bank as fiduciary without the necessity of any instrument of transfer or conveyance.

1974, c. 286, § 6.1-32.9; 1987, c. 352; 1991, c. 282; 2010, c. 794; 2020, c. 239.

The chapters of the acts of assembly referenced in the historical citation at the end of this section may not constitute a comprehensive list of such chapters and may exclude chapters whose provisions have expired.