If the instrument under which a trust institution acts as fiduciary, whether such fiduciary capacity arose before or is created after July 8, 1943, shall either expressly or by its silence limit or restrict the investment of moneys of the estate and securities to the class authorized by law as legal investments, the trust institution may, in its capacity as sole fiduciary or with the consent of any person acting with it in a fiduciary capacity, invest and reinvest moneys of the estate in any such common trust fund maintained by the trust institution or by an affiliated trust institution, provided, the securities composing such fund consist solely of securities of the class authorized as legal investments for funds held by a fiduciary. If the instrument under which the trust institution acts as fiduciary, whether such fiduciary capacity arose before or is created after July 8, 1943, shall authorize investments of moneys of the estate in a common trust fund or in investments other than those designated by law as legal investments or shall authorize the trust institution, either alone or in conjunction with any person acting with it in a fiduciary capacity, to exercise its or their discretion with respect to the investment of moneys of the estate, the trust institution may, in its capacity as sole fiduciary or with the consent of any person acting with it in a fiduciary capacity, invest and reinvest moneys of the estate in any such common trust fund maintained by it or by an affiliated trust institution. Any such common trust fund consisting solely of moneys of estates contributed thereto by the trust institution pursuant to authority contained in any such instrument creating the fiduciary capacity to invest moneys of the estates in a common trust fund or in investments other than legal investments or pursuant to such discretionary powers with respect to the investment of moneys creating the fiduciary capacity may be composed of investments other than those of the class designated by law as legal investments for funds held by fiduciaries. In order to determine whether the investment of funds received or held by a trust institution as fiduciary in a participation in a common trust fund is proper, the trust institution may consider the common trust fund as a whole and shall not, for example, be prohibited from making such investment because any particular asset is nonincome-producing.
Last modified: May 3, 2021