NY Banking L § 100-B (2021)
2021 New York Laws BNK - Banking Article 3 - Banks and Trust Companies 100-B - Investments as Fiduciary; When Interest Is to Be Paid; Preference.

§ 100-b. Investments  as  fiduciary;  when  interest  is  to  be paid;   preference. 1. Investments. All investments of  money  received  by  any   trust  company  as executor, administrator, guardian, trustee of a trust   of any kind, receiver, committee, conservator or depositary, shall be at   its sole risk, and for all losses  of  such  money  the  capital  stock,   property  and  effects  of the trust company shall be absolutely liable,   unless the investments are such as are proper when made by an individual   acting  as  trustee,  executor,   administrator,   guardian,   receiver,   committee, conservator or depositary, or such as are permitted in and by   the instrument or words creating or defining the trust. But no corporate   fiduciary  shall purchase securities from itself. Any moneys of any such   estate or fund awaiting  investment  or  distribution  may  be  held  on   deposit by such trust company in its own name, subject to the provisions   of  subdivision  four of this section; provided that appropriate entries   showing the share or interest of each such estate or fund in the  moneys   so  held on deposit shall, at all times, appear upon the records of such   trust company.2. On and after September first, nineteen hundred thirty-six, no trust   company shall invest in any part interest in a bond and mortgage or note   and mortgage on behalf of any estate or fund held by such trust  company   as  executor, administrator, guardian, personal or testamentary trustee,   receiver, committee,  conservator  or  depositary  except  that  if  the   instrument  creating  such  estate  or  fund  has  authorized such trust   company as executor, administrator, guardian, personal  or  testamentary   trustee, receiver, committee, conservator or depositary to invest in any   part interest in a bond and mortgage or note and mortgage insured by the   federal housing commissioner such trust company may so invest and if the   instrument  creating an employee benefit trust has authorized such trust   company to invest in any part interest in a bond and  mortgage  or  note   and  mortgage,  such trust company may so invest. Any part interest in a   bond and mortgage or note and mortgage  heretofore  apportioned  to  any   estate   or   fund   and   held  by  such  trust  company  as  executor,   administrator, guardian, personal  or  testamentary  trustee,  receiver,   committee, conservator or depositary, and outstanding at any time in the   hands of any estate, fund or person may be repurchased at its face value   by  such corporation individually. Such trust company, in any case where   it shall have apportioned or transferred a part interest in any bond and   mortgage or note and mortgage whether to any estate or fund held  by  it   alone  or  in  conjunction  with  another  person or otherwise, shall be   authorized and empowered, in behalf of all persons  interested  therein,   to  collect  the principal and interest and to satisfy and discharge the   mortgage on receiving payment thereof in the amount and  in  the  manner   specified in the bond and mortgage or note and mortgage, to pay the said   principal  and interest to the persons entitled thereto and generally to   exercise all of the options reserved to the mortgagee, to enforce in its   own name by appropriate action or proceeding, including foreclosure, any   and all of the covenants in the said  bond  and  mortgage  or  note  and   mortgage, to take such other measures for the protection of the mortgage   loan  and  the  preservation  of  the  security  and  the management of,   utilization and sale of  any  real  estate  which  may  be  acquired  on   foreclosure  as  may  be  necessary  and appropriate and to exercise all   other rights of ownership in respect of the entire bond and mortgage  or   note  and mortgage. In case any bond, note or mortgage shall be held by,   or in the name of, such  trust  company  and  it  shall  hold  any  part   interest   therein,   acting  as  a  fiduciary,  whether  alone,  or  in   conjunction with another person or otherwise, it  may,  prior  to  April   first, nineteen hundred sixty-nine, waive or modify or agree to waive or   modify,  either with or without consideration and prior or subsequent to    maturity, any terms  and  conditions  thereof,  including  the  rate  of   interest,  and  extend or re-extend or agree to extend or re-extend such   bond and mortgage or note and mortgage, for a period of  not  more  than   five  years from the time of such extension, by agreement with the owner   of the real property subject to the lien thereof, upon  the  consent  of   the  holders  of  such  part  interests  to  the extent of sixty-six and   two-thirds per centum of the whole amount of such bond and  mortgage  or   note  and  mortgage,  notwithstanding  that, at the time of such waiver,   modification, extension or agreement, the value of  such  real  property   may be less than that required by law for an original investment of such   an  amount  therein  by  such holder and, in case any such investment is   guaranteed, such trust company may also extend or re-extend or agree  to   extend  or  re-extend  the time of payment under the guaranty for a like   period from its due date, and may  release  or  agree  to  release  such   guaranty  or  from  time  to  time  waive or modify or agree to waive or   modify any terms and conditions thereof, including the rate of interest;   provided however,  that  no  such  waiver,  modification,  extension  or   agreement shall be made or agreed to unless, at least fifteen days prior   thereto,  such  trust  company shall have notified each holder of such a   part interest in such bond and mortgage or  note  and  mortgage  of  the   terms   and   conditions  of  such  contemplated  waiver,  modification,   extension or agreement. Such notice shall be given by mailing  the  same   by  registered  mail to the address or place of residence of each holder   according to the records of such trust company. The notice  hereinbefore   provided  for  shall not be required to be given to any holder of such a   part interest in such bond and mortgage or note and mortgage (1) who, at   the time of the mailing of such notice to holders of part  interests  in   such  bond  and  mortgage  or  note  and  mortgage, was not shown on the   records of such trust company to be such holder, or (2) who, at any time   whether before or after any  such  waiver,  modification,  extension  or   agreement  shall  have  been  made or agreed to, shall have consented to   such waiver, modification, extension  or  agreement.  Any  such  consent   shall also be binding upon and shall be deemed to be the consent also of   each  and every holder of the part interest in such bond and mortgage or   note and mortgage or of any part of such part interest with  respect  to   which  such  consent  was given who, at the time such consent was given,   was not shown on the records of such trust company  to  be  such  holder   whether or not such holder shall have become such holder before or after   such  consent  was  given.  Any  holder  to whom the notice hereinbefore   provided for is required to be given as hereinbefore  provided  and  who   objects  to such waiver, modification, extension or agreement shall have   the right to apply, within fifteen days after  such  notice  shall  have   been  mailed  to  such  holder  as hereinbefore provided, to the supreme   court of the county in which the real property securing such mortgage is   located and, subject to the discretion  of  the  supreme  court  in  the   premises,  to  obtain  an  order  enjoining  such  waiver, modification,   extension or agreement. In the event of the granting of such  an  order,   any  holder  shall  have  the  right to apply to such supreme court and,   subject to the discretion of the  supreme  court  in  the  premises,  to   obtain  an order directing a partition of such bond and mortgage or note   and mortgage by a judicial sale thereof. Such sale shall  be  upon  such   notice  and  advertisement and at such time and place and in such manner   as the court or a justice thereof may direct, but at least fifteen days'   notice thereof shall be given to each holder. The proceeds of  the  sale   of  such  bond  and  mortgage  or  note and mortgage after deducting the   expenses of such sale, shall be paid into the supreme court and shall be   distributed among such holders according to their  respective  interests   therein.  Such  trust companies shall have all the powers heretofore had    under this section or  any  other  provision  of  law  with  respect  to   investments  in  part  interests  in  bonds  and  mortgages or notes and   mortgages for the protection, preservation and liquidation of the  trust   property.  It is the intent of this subdivision to prohibit after August   thirty-first, nineteen hundred thirty-six, any future apportionments  or   investments  of  any part interests in bonds and mortgages and notes and   mortgages to or investments in part interests of bonds and mortgages and   notes and mortgages for any estate or fund of which such  trust  company   is  executor, administrator, guardian, personal or testamentary trustee,   receiver, committee, conservator or depositary, except as  permitted  by   this subdivision. Such trust company, however, shall not transfer to any   estate  or  fund  any part interests in bonds and mortgages or notes and   mortgages heretofore purchased, or invested in, from itself or from  any   other estate or fund.Nothing  contained  in  this  act  shall  be  construed  to affect any   investments in part interest  in  bonds  and  mortgages  apportioned  or   transferred,  prior  to September first, nineteen hundred thirty-six, to   any  estate  or  fund  of  which  such  trust   company   is   executor,   administrator,  guardian,  personal  or  testamentary trustee, receiver,   committee,  conservator  or  depositary,  nor  to  affect   any   action   heretofore  taken  in accordance with law with respect to such bonds and   mortgages or part interests in said bonds and mortgages; nor  to  affect   the  right  of  any such trust company to transfer or apportion any such   investment from an estate or fund to a succeeding  interest  created  by   the same instrument under which the investment was made; nor shall it be   construed  to impair or otherwise affect the power of such trust company   to apportion to any estate, fund or person interested in  such  mortgage   its or his proportionate share of the consideration, consisting in whole   or  in  part  of  evidences of indebtedness secured by mortgages on real   property received by such trust company on the  sale  of  real  property   acquired  by foreclosure of such mortgage, or otherwise, and to exercise   with respect to such mortgages on behalf  of  such  estates,  funds,  or   persons the same powers reserved with respect to the original mortgage.3.  Preference.  If  dissolved  by  the  legislature  or the court, or   otherwise, or liquidated by the superintendent or otherwise,  the  debts   from  any  trust  company as guardian, trustee, executor, administrator,   committee, conservator or depositary, shall be entitled to  priority  of   payment  from  the  assets of such trust company on an equality with any   other priority given by this chapter.4. Interest. On all sums of money not less than one thousand  dollars,   which  shall  be  collected,  received  and held as principal by a trust   company acting as executor, administrator, guardian, trustee,  receiver,   committee  or conservator under the appointment of any court or officer,   or in any fiduciary capacity under such appointment, or as a  depositary   of  moneys paid into court, interest shall be paid by such trust company   from sixty days after the receipt thereof until the moneys  so  received   shall  be  duly  expended or distributed, at a rate equal to the maximum   rate per annum  then  being  paid  by  such  trust  company  on  savings   deposits,  except that in the case of a trust company acting as executor   or administrator interest shall not be paid, and  the  grace  period  of   sixty  days herein provided for shall not be deemed to begin, until five   months after  the  date  of  issuance  of  letters  testamentary  or  of   administration to it; provided however that such trust company shall not   be  required to allow any interest upon any such moneys payment of which   is prohibited under any order, regulation  or  ruling  issued  under  or   pursuant to the "Trading with the Enemy Act" and any amendments thereto,   or under or pursuant to any other law, so long as such prohibition shall   remain  in  force  and  effect.  If income be accumulated for a minor or    surplus income in excess of expenditures be held for investment  by  the   committee of an incompetent or the conservator of a conservatee, but not   otherwise,  any  uninvested  balance  of such income shall be treated as   principal  upon  which  interest  shall  be  paid  as  provided  in this   subdivision. If interest moneys payable hereunder or  any  part  thereof   shall  not  annually be expended or distributed pursuant to the terms or   provisions of the trust under which such moneys  are  held,  the  amount   thereof  not  so  expended  or  distributed shall be accumulated by such   trust company for the benefit of the parties interested  in  such  trust   fund,  and shall be added to the principal to constitute a new principal   upon which interest shall thereafter be computed. The word "trustee"  as   used  in  this  subdivision shall mean a trustee appointed by will or by   any court, and the words "savings deposits" as used in this  subdivision   shall  mean  time  deposits  with  respect to which the depositor is not   required by the deposit contract, but may at any  time  be  required  by   such  trust company, to give notice in writing of an intended withdrawal   not less than fourteen days before such withdrawal is made, and which is   not payable on a specified date or at the expiration of a specified time   after the date of deposit. For the purposes of  this  subdivision  only,   moneys  on  which  interest  is  payable as provided herein shall not be   deemed to be demand deposits.