If you’re wondering “why does the bank need a copy of my trust?” you’re not alone…
In many cases, people setup trusts for privacy purposes, so being asked to disclose trust documents can be concerning.
With this in mind, we’re going to discuss what banks actually need to see and what they don’t need to see from a trust.
This is based on our team’s experience supporting individuals with opening accounts for trusts and accessing high-net-worth private banking more broadly.
Feel free to use the table of contents to jump ahead to any sections most relevant to you.
Table of Contents
- Why Does the Bank Need a Copy of My Trust?
- Important Banking Considerations
- Reasons Why Banks Request Copies of Trusts
- Ready to Explore Your Options?
Why Does the Bank Need a Copy of My Trust?
In short, the bank does not need a copy of your entire trust. Instead, they will likely need access to specific information, which is provided in the Memorandum of Trust or a Certificate of Trust (typically provided by the bank).
Banks may also ask to review additional pages (typically the first and last page) of your trust documents in order to confirm the date of formation and that the trust has been notarized.
Of course, there are a number of variables that can impact the documents that might be requested or required. Two of the most important variables include the actions you are trying to take at the bank and the jurisdictions are involved.
Let’s take a closer look:
1. What action are you trying to take at the bank?
For example, are you looking to open a bank account for an existing trust that already has assets contributed to it? Or, are you looking to have ownership of your personal bank account changed to the trust?
2. What jurisdictions are involved?
Different jurisdictions naturally have different rules and regulations that apply to account opening, change of account ownership, and generally dealing with trusts. Additionally, if your trust has been set up in a foreign jurisdiction, this may have additional implications for the documents that a bank will require.
Do You Want More International Banking Insights?
Sign up here to receive our Free Non-Resident Banking Starter Guide and weekly updates on the best account opening options available:
Important Banking Consideration
While most bankers are experienced with opening accounts for individuals and businesses, trusts (and similar estate planning structures) are not as common and fewer bankers deal with them on a regular basis. This is especially true if you are dealing with bankers in retail banking divisions that do not commonly support high-net-worth clients of the bank.
As a result, it’s possible that bankers may request unnecessary trust documentation during the account opening process. In fact, they may not know that the information they require is available in the Memorandum of Trust or a Certificate of Trust.
With this in mind, it’s always best to first educate yourself on what is actually needed in order to achieve your goals so you can gently direct the banker to the information they actually require.
Reasons Why Banks Request Copies of Trusts
If a bank requests a copy of your trust, you should pause and consider whether this is an accurate request. As mentioned above, many bankers are unfamiliar with trusts and can unknowingly overreach during the account opening or asset contribution process.
With this in mind, there are two main scenarios that a bank may request copies of a trust (or related documents), which include opening accounts for a trust directly or contributing assets to a trust.
If this happens and you are unable to convince the bank that the information they require is included in the Memorandum of Trust or Certificate of Trust, you may need to have your lawyer contact the bank to communicate with them directly.
Alternatively, if you are unable to convince your current bank that they do not need access to the intimate details of a private trust, it may be time to open accounts with a bank that respects your privacy and understands the intracices of banking for high-net-worth individuals.
Ready to Explore Your Options?
If you would like assistance navigating your private banking options at home or abroad, we can help.
You can access GlobalBanks IQ, our international banking intelligence platform, in just a few clicks. Unlock our bank database, individual bank profiles, account opening strategies and reports, banker scripts, and more.
But, if you want a 100% personalized account opening service that taps into our team’s expertise and provides direct banker introductions, you can get started with GlobalBanks Insider.
Of course, if you have any questions, please contact us directly.