What is a Corporation Fiduciary?   A Corporate Fiduciary is a bank that qualifies under federal or state law to act as Trustee or Personal Representative of a decedent’s estate.  In short, the bank is entrusted with assets to manage and administer in accordance with specific guidelines and instructions given by one’s Last Will, Trust, or other fiduciary instruction.

When is it Appropriate to Name a Corporate Fiduciary?  It is appropriate to name a Corporate Fiduciary in estate planning documents when the family or financial dynamics require an impartial professional bank trust department team to handle the administration of the estate or trust.

When Does the Appointment of a Corporate Fiduciary Makes Sense? There are many instances. Here are a few common fact patterns when a Corporate Fiduciary should be seriously considered.

1. High probability family members who are candidates to serve as Personal Representative or Trustee are likely to disagree on most issues.
2. No suitable family members or advisers willing to serve.
3. Complicated tax planning that requires careful attention to details.
4. The need for professional money management whether by the Corporate Fiduciary or an outside money manager monitored by the Corporate Fiduciary.
5. When a beneficiary or beneficiaries suffer from or are susceptible to addictions.
6. When there are no children or close family members.
7. When there are children or family members who do not have the time, expertise, or qualifications to serve.

How do you Select a Corporate Fiduciary? Many banks have private banks and trust departments devoted to providing fiduciary services. Frequently, the estate attorney can make recommendations. Here are some questions and issues to address when interviewing prospective banks.

1. How much fiduciary money does the bank have under management?
2. How many people are on the trust management team? Usually there is a business development officer, a trust administrator, and a money manager. These positions are frequently supported by assistants.
3. Are all team members local?
4. Are there regular meetings with all team members at a local office?
5. How many client relationships does the trust administrative officer have and is there a limit on the amount of relationships.
6. How long has the each team member been with employed by bank or its predecessor if there was a recent merger.
7. What is the investment performance over the past several years and request a break down for different classification of assets such as domestic stocks, foreign stock, fixed income, real estate, etc.
8. What is the fee structure?
9. Is there a difference in billing for fixed income investments as compared to equity investments?
10. Are fees internal to certain investments (such as mutual funds affiliated with the bank) credited against the agreed upon fee?
11. What are the Menu of  Additional Services?  In addition to the administration and investment advice, what other services are provided such as: Bill Paying; Income Tax Preparation; and Accounting.

Note: This blog is designed for general information only. The information presented at this site should not be construed to be neither formal legal advice nor the formation of a lawyer/client relationship. If you would like to contact Stuart A. Rader regarding an area of probate and trust administration, estate planning, taxation, and succession planning for closely held businesses, please email counselor@floridaprobatelawblog.com.