| a company or corporation organized to exercise the functions of a trustee, but usually engaging also in other banking and financial activities. |
| trust company n. A commercial bank or other corporation that manages trusts. |
Trust Company
A legal entity that acts as fiduciary, agent or trustee on behalf of a person or business entity for the purpose of administration, management and the eventual transfer of assets to a beneficial party. The entity acts as a custodian for trusts, estates, custodial arrangements, asset management, stock transfer, beneficial ownership registration and other related arrangements. A trust company does not own the assets its customers assign to its management, but it may assume some legal obligation to take care of assets on behalf of other parties.
Investopedia Commentary
A trust company or trust department is usually a division or an associated company of a commercial bank. Trusts and similar arrangements managed for eventual transfer are managed for profit, which may be taken out of the assets on an annual basis or upon transfer to the beneficial third party. There are often tax advantages associated with using trusts to transfer ownership of assets, but any trust arrangement should be made through qualified professionals that are capable of giving tax and legal advice.
Related Links
Getting Started On Your Estate Plan
Who Is The Beneficiary Of Your Account?
Skipping-Out on Probate Costs
See also: Agent, Beneficial Owner, Beneficiary, Commercial Bank, Custodian, Estate, Fiduciary, Transfer Agent, Trust, Trustee
Also spelled: Trust Department