Trust company

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Trust company

An organization that acts as a fiduciary and administers trusts.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Trust Company

A company, usually a division of a bank or brokerage, that acts as a trustee. In this relationship, one party, known as the trustor, gives to the trustee the right to hold and invest assets or property on behalf of a third party, known as the beneficiary. Most trusts exist to provide for the financial future of a minor child or mentally incompetent person, or may benefit charitable organizations. Many trusts are exempt from taxation on money given to the beneficiary, but trust companies may charge a fee in order to administer the assets. See also: Trust.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved
References in periodicals archive ?
First, regulated trust companies don't encompass all of the trust business in the state.
When Crosby Advisors moved its offices to Salem, it prompted a 2010 Wall Street Journal article that called the Granite State "a kind of mini-Switzerland for wealthy Northeast families." And the Boston Herald reported that such family trust companies are "cropping up like tax-free liquor stores in southern New Hampshire."
Even the assets listed by those trust companies might not capture all of the wealth involved because a chunk of the assets are insurance policies, according to Matthew McKenzie, president of Thomas Brady & Associates, which writes such estate-planning policies.
The Legislature passed a set of laws that allows nondepository trust companies flexibility in developing products and services within a well-managed regulatory framework."
However, unlike nondepository trust companies, family fiduciary service companies serve only family members.
Since the New Trust Modernization and Competitiveness Act recognizes a difference between trust companies that are acting as full-fledged banks and those that are merely serving families, it allows for reduced administrative and accounting burdens on family fiduciary service companies.