OTS Preempts State Bars to Trust Marketing

Thrifts looking to expand their trust operations recently got good news from the Office of Thrift Supervision.

In a legal opinion, the agency declared that a federally chartered thrift may market and advertise its trust services in any state, even if state laws bar it. Marketing activities include mail and phone solicitations, information seminars, and personal visits to describe trust services.

The decision came seven months after the Office of the Comptroller of the Currency had ruled that national banks can market trust services nationwide.

The OTS opinion addressed laws in Vermont, New York, Ohio, and California that restricted the marketing of trust services by out-of-state institutions. The agency ruling preempts all similar state laws.

In her opinion, OTS Chief Counsel Carolyn Buck stated that under the Home Owners' Loan Act a federal thrift's marketing of trust services is not limited to states where it has trust offices. "There is no affirmative indication of a congressional intent to restrict interstate marketing of trust powers," Ms. Buck wrote.

Her opinion, issued June 21, is the latest in a series of OTS rulings regarding trust activities by federally chartered thrifts. Last March, the OTS concluded that federal thrifts are permitted to offer trust services nationwide through agency offices with OTS approval.

For reprint and licensing requests for this article, click here.
MORE FROM AMERICAN BANKER