Virginia § 6.2-1089 - Funds awaiting investment or distribution
Full text of Virginia Code of Virginia § 6.2-1089 — Funds awaiting investment or distribution, with citation guidance and answers to common questions.
§ 6.2-1089. Funds awaiting investment or distribution
A. Funds and assets held in a fiduciary capacity by an association awaiting investment or distribution shall not be held uninvested or undistributed any longer than is reasonable for the proper management of the trust account.
B. Funds and assets held in trust by an association, including managing agency accounts, awaiting investment or distribution, unless prohibited by the governing instrument, may be deposited in other departments of the association, provided that the association shall first set aside under the sole control of the trust department, as collateral security:
1. Direct obligations of the United States, or other obligations fully guaranteed by the United States as to principal and interest;
2. Readily marketable securities of the classes in which fiduciaries are authorized or permitted to invest trust funds, as set forth in § 64.2-1502; or
3. Other readily marketable securities as may be authorized by the Commissioner.
Such collateral securities, or securities substituted therefor as collateral, shall at all times be at least equal in face value to the amount of trust funds so deposited, but such security shall not be required to the extent that the funds so deposited are insured by the Federal Deposit Insurance Corporation or other federal insurance agency. The requirements of this subsection are met when qualifying assets of the association are pledged in such manner as to fully secure all trust account funds deposited by the trust department of the association in another department of the association.
C. Any funds held by an association as fiduciary awaiting investment or distribution and deposited in other departments of the association shall be made productive.
D. In the event of the failure or liquidation of an association, the owners of the funds held in trust and deposited in another department of the association shall have a first lien on the securities set apart as collateral for such funds, in addition to any other claim that such owners may have against the association.
1984, c. 303, § 6.1-195.86; 1990, c. 3; 1992, c. 810; 2010, c. 794.
Source: official Virginia text · Last verified 2026-08-27
Frequently Asked Questions About Virginia § 6.2-1089
What does Code of Virginia § 6.2-1089 cover?
Section 6.2-1089 ("Funds awaiting investment or distribution") is part of the Code of Virginia, the codified statutory law of Virginia. It sets out the legal rule or procedure described in the text above. Statutes are amended regularly, so always verify against the official source.
How do I cite Virginia § 6.2-1089?
A common citation format is "Code of Virginia § 6.2-1089" (Virginia). Legal writing may require the code abbreviation, section number, and year or edition. Match the style required by your court, professor, or publisher.
Is this the official text of Virginia law?
No. This page is for research and education and may not include the most recent amendments. For official current law, check the Virginia official source linked on this page or consult a licensed Virginia attorney.
How does Virginia § 6.2-1089 apply to my situation?
Statutes are interpreted in context, and application depends on your specific facts. Only a licensed attorney in Virginia can advise on how this section applies to you. Contact your state or local bar association for a referral.
Sources & Verification
Not legal advice. Verify against the official source and consult a licensed attorney in Virginia.