{"data":{"id":"us-ky/krs-286.3-277","jurisdiction":"us-ky","citation":"KRS 286.3-277","heading":"Standards for bank or trust company acting as fiduciary.","body":"(1) Notwithstanding the provisions of any other law, a bank empowered to act as a\nfiduciary or trust company, when investing, reinvesting, purchasing, acquiring,\nexchanging, selling, and managing property held in a fiduciary capacity, shall act as\na prudent investor would, in light of the purposes, terms, distribution requirements,\nand other circumstances of the fiduciary account.\n(2) The standard described in subsection (1) of this section requires the exercise of\nreasonable care, skill, and caution, and is to  be applied to investments not in\nisolation but in the context of the account portfolio and as part of an overall\ninvestment strategy, which should incorporate risk and return objectives reasonably\nsuitable to the account.\n(3) In making and implementing investment decisions, the bank or trust company has a\nduty to diversify the investments of the account unless, under the circumstances, it\nis prudent not to do so.\n(4) In addition, the bank or trust company shall:\n(a) Conform to fundamental fiduciary duties of loyalty and impartiality;\n(b) Act with prudence in deciding whether and how to delegate authority and in\nthe selection and supervision of agents; and\n(c) Incur only costs that are reasonable in amount and appropriate to the\ninvestment responsibilities of the account.\n(5) The duties of the bank or trust company under this section are subject to the rule\nthat in investing the funds of the account, the bank or trust company:\n(a) Has a duty to the beneficiaries of the account to conform to any applicable\nstatutory provisions governing investment by fiduciaries; and\n(b) Has the power expressly or impliedly granted by the terms of the account or\napplicable instrument and has a duty to the beneficiaries of the account to\nconform to the terms of the account direc ting or restricting investments by the\nbank or trust company.","path":[],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=14571","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:57:10Z","sha256":"5a33dbed39450d53121a272bb7577b3d17b1ead274b78623dc09618a2cecdc13","source_id":"us-ky","stale":false,"prev":"us-ky/krs-286.3-275","next":"us-ky/krs-286.3-280"},"notice":"GroundRules: Original legal text. Not legal advice."}