Virginia Code 6.2-1091: Voting of financial institution stock held by association as fiduciary; when association disqualified from voting
A. When voting shares of a financial institution are held by an association in a trust account, the association may not vote or participate in the voting of any such shares if the securities held in such fiduciary capacity, together with all the other voting securities of such financial institution held in a fiduciary capacity by the association and its affiliates, exceed 25 percent of the outstanding voting securities of such financial institution. If the voting securities of any financial institution held by an association in a trust account, together with all other voting securities of such financial institution held in a fiduciary capacity by the association and its affiliates, exceed five percent of the outstanding voting securities of such financial institution, but less than 25 percent thereof, the association may not vote or participate in the voting of any such voting securities unless there has been a determination by the Commissioner that the right to vote such shares does not constitute control of the particular financial institution in question.
Terms Used In Virginia Code 6.2-1091
- Association: has the meaning assigned to it in § 6. See Virginia Code 6.2-1081
- Commissioner: means the Commissioner of Financial Institutions. See Virginia Code 6.2-100
- Fiduciary: means the status resulting from an association's undertaking to act alone, through an affiliate, or jointly with others, primarily for the benefit of another, and includes an association's acting as trustee, executor, administrator, committee, guardian, conservator, receiver, managing agent, registrar of stocks and bonds, escrow, transfer, or paying agent, trustee of employee pension, welfare and profit sharing trusts, and in any other similar capacity. See Virginia Code 6.2-1081
- Fiduciary: A trustee, executor, or administrator.
- Financial institution: means any bank, trust company, savings institution, industrial loan association, consumer finance company, or credit union. See Virginia Code 6.2-100
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- Person: means any individual, corporation, partnership, association, cooperative, limited liability company, trust, joint venture, government, political subdivision, or other legal or commercial entity. See Virginia Code 6.2-100
- Trust account: means the account established pursuant to a trust, estate, or other fiduciary relationship that has been established with an association. See Virginia Code 6.2-1081
- Trust account: A general term that covers all types of accounts in a trust department, such as estates, guardianships, and agencies. Source: OCC
B. If any person is acting as fiduciary, in addition to the association, for the trust account containing such voting securities, such other fiduciary, if not a director, officer, or employee of the association or its affiliates, may vote such shares. If the association is the sole fiduciary for the trust account, the association may petition an appropriate court for the appointment of a co-fiduciary for the sole purpose of voting such shares. Such appointment and qualification may be ex parte, and no prior notice to the beneficiaries of the trust account shall be required. The court at the time of such qualifications may relieve the co-fiduciary of any obligation for the giving of security on his bond. If the appointment of the co-fiduciary is limited to voting such shares, such order may provide that the co-fiduciary shall not be liable or accountable in the administration of the trust account, except for the breach of any fiduciary duty in voting or failing to vote such shares. No director, officer, or employee of the petitioning association or its affiliates shall be eligible to be named co-fiduciary under the provisions of this section.
C. The provisions of this section shall also apply in the case of voting shares of a bank holding company, as defined in 12 U.S.C. § 1841, or a savings and loan holding company held by an association in a fiduciary capacity.
1984, c. 303, § 6.1-195.88; 2010, c. 794.