OCC Issues Guidance on Authority to Charter Limited Purpose Trust Companies

On January 11, the OCC issued an interpretive letter in which it took the position that Section 27(a) of the National Bank Act permits the OCC to charter a national bank that limits its operations to those of a trust company and activities related thereto. According to the interpretive letter, activities of a trust company include activities permissible for a state trust bank or trust company under state law in the state where the national bank is located, such as acting as a custodian, even if those state authorized activities are not necessarily considered fiduciary in nature under federal law. The letter goes on to explain that a national trust bank may be permitted to engage in any and all activities permitted under state law for a state trust company and may also engage in activities beyond those authorized under state law for a state trust company provided such activities are permitted for a national bank under other provisions of the National Bank Act, raising the possibility that a limited purpose national bank could potentially be organized to perform trust company functions and other permissible functions such as lending and payments