2023 Nevada Revised Statutes › Chapter 669A - Family Trust Companies › NRS 669A.230 - Investments.

1. Except as otherwise provided in subsection 2, the assets forming the minimum capital of a licensed family trust company pursuant to NRS 669A.160 must:
(a) Consist of:
(1) Cash;
(2) Governmental obligations or insured deposits that mature within 3 years after acquisition;
(3) Readily marketable securities or other liquid, secure assets, bonds, sureties or insurance; or
(4) Any combination thereof.
(b) Have an aggregate market value that equals or exceeds 100 percent of the company’s required stockholders’ equity.
2. A licensed family trust company may purchase or rent real or personal property for use in the conduct of the business and other activities of the company.
3. Except as otherwise provided in NRS 669A.225 and notwithstanding any other provisions of law to the contrary, a licensed family trust company may invest its funds for its own account, other than those required or permitted to be maintained by subsection 1 or 2, in any type or character of equity securities, debt securities or other asset provided the investment complies with the prudent investor standards set forth in NRS 164.700 to 164.775, inclusive.
4. Except as otherwise provided in NRS 669A.225 and notwithstanding the provisions of any other law to the contrary, a family trust company is authorized while acting as a fiduciary to purchase for the fiduciary estate, directly from underwriters or distributors or in the secondary market:
(a) Bonds or other securities underwritten or distributed by the family trust company or an affiliate thereof or by a syndicate which includes the family trust company, provided that the family trust company discloses in any written communication or account statement reflecting the purchase of those bonds or securities the nature of the interest of the family trust company in the underwriting or distribution of those bonds and securities and whether the family trust company received any fee in connection with the purchase; and
(b) Securities of any investment company for which the family trust company acts as advisor, custodian, distributor, manager, registrar, shareholder servicing agent, sponsor or transfer agent, or provided the family trust company discloses in any written communication or account statement reflecting the purchase of the securities the nature of the relationship and whether the family trust company received any fee for providing those services.
5. Except as otherwise provided in NRS 669A.225, the authority granted in subsection 4 may be exercised only if:
(a) The investment is not expressly prohibited by the instrument, judgment, decree or order establishing the fiduciary relationship;
(b) The family trust company discloses in writing to the person or persons to whom it sends account statements its intent to exercise the authority granted in subsection 4 before the first exercise of that authority; and
(c) The family trust company procures in writing the consent of its cofiduciaries with discretionary investment powers, if any, to the investment.
6. Except as otherwise provided in NRS 669A.225, a family trust company may:
(a) Invest in the securities of an investment company or investment trust, to which the family trust company or its affiliate provides services in a capacity other than as trustee. The investment is not presumed to be affected by a conflict between personal and fiduciary interests if the investment complies with the prudent investor standards set forth in NRS 164.700 to 164.775, inclusive.
(b) Be compensated by an investment company or investment trust described in paragraph (a) for providing services in a capacity other than as trustee if the family trust company discloses at least annually to each person to whom it sends account statements the rate and method by which the compensation was determined.
7. Except as otherwise provided in NRS 669A.225, nothing in subsections 4, 5 and 6 shall affect the degree of prudence which is required of fiduciaries under the laws of this State. Any bonds or securities purchased under authority of this section are not presumed to be affected by a conflict between the fiduciary’s personal and fiduciary interest if the purchase of the bonds or securities:
(a) Is at a fair price;
(b) Is in accordance with:
(1) The interest of the beneficiaries; and
(2) The purposes of the trusts; and
(c) Complies with:
(1) The prudent investor standards set forth in NRS 164.700 to 164.775, inclusive; and
(2) The terms of the instrument, judgment, decree or order establishing the fiduciary relationship.
8. Except as otherwise provided in NRS 669A.225 and notwithstanding the provisions of subsections 4 to 7, inclusive, a family trust company which is authorized to exercise trust powers in this State and which is acting as a fiduciary shall not purchase for the fiduciary estate any fixed income or equity security issued by the family trust company or an affiliate thereof unless:
(a) The family trust company is expressly authorized to do so by:
(1) The terms of the instrument creating the trust;
(2) A court order;
(3) The written consent of the grantor of the trust; or
(4) The written consent of every adult beneficiary of the trust who, at the time notice is provided pursuant to paragraph (b) of subsection 5, receives or is entitled to receive income under the trust or who would be entitled to receive a distribution of principal if the trust were terminated; or
(b) The purchase of the security:
(1) Is at a fair price; and
(2) Complies with:
(I) The prudent investor standards set forth in NRS 164.700 to 164.775, inclusive; and
(II) The terms of the instrument, judgment, decree or order establishing the fiduciary relationship.
9. As used in this section:
(a) "Face-amount certificate" has the meaning ascribed to it in 15 U.S.C. § 80a-2(a)(15).
(b) "Government securities" has the meaning ascribed to it in 15 U.S.C. § 80a-2(a)(16).
(c) "Investment company" means any issuer which:
(1) Is or holds itself out as being engaged primarily, or proposes to engage primarily, in the business of investing, reinvesting or trading in securities;
(2) Is engaged or proposes to engage in the business of issuing face-amount certificates of the installment type, or has been engaged in such business and has any such certificate outstanding; or
(3) Is engaged or proposes to engage in the business of investing, reinvesting, owning, holding or trading in securities, and owns or proposes to acquire investment securities having a value exceeding 40 percent of the value of the total assets of the issuer, exclusive of government securities and cash items, on an unconsolidated basis.
(d) "Issuer" has the meaning ascribed to it in 15 U.S.C. § 80a-2(a)(22).
(Added to NRS by 2009, 1142; A 2011, 1814)