636.23 Authorized securities. All proposed investments of trust funds by fiduciaries shall first be reported to the court or a judge for approval and be approved and unless otherwise authorized or directed by the courtunder authority of which the fiduciary acts, or by the will, trust agreement, or other documentwhich is the source of authority, a trustee, executor, administrator, or guardian shall investall moneys received by such fiduciary, to be by the fiduciary invested, in securities which atthe time of the purchase thereof are included in one or more of the following classes: 1. Federal bonds. Bonds or other interest-bearing obligations of the United States for the payment of which the faith and credit of the United States is pledged. 2. Federal bank bonds. Bonds, notes or other obligations issued by any federal land bank, federal intermediate credit bank, bank for cooperatives, or any or all of the federalfarm credit banks, and in bonds issued by any federal home loan bank under the Act ofCongress known and cited as the federal Home Loan Bank Act, 12 U.S.C. §1421 – 1449 andthe Acts amendatory thereof. 3. State bonds. s, and in bonds issued by any federal home loan bank under the Act ofCongress known and cited as the federal Home Loan Bank Act, 12 U.S.C. §1421 – 1449 andthe Acts amendatory thereof. 3. State bonds. Bonds or other interest-bearing obligations of any state in the United States for the payment of which the faith and credit of such state is pledged and which statehas not defaulted in the payment of any of its bonded debts within the ten preceding years. 4. Municipal bonds. Bonds, or other interest-bearing obligations, which are a direct obligation of a county, township, city, school district, or other municipal corporation ordistrict, having power to levy general taxes in the state of Iowa, and also bonds or otherinterest-bearing obligations which are a direct obligation of a county, township, city, village,school district, or other municipal corporation or district, having power to levy general taxesin any adjoining state, and having a population of not less than five thousand. However, thetotal funded indebtedness of a municipality enumerated in this subsection shall not exceedten percent of the assessed value of the taxable property in the municipality, as ascertainedby the last , thetotal funded indebtedness of a municipality enumerated in this subsection shall not exceedten percent of the assessed value of the taxable property in the municipality, as ascertainedby the last assessment for tax purposes, and the municipality or district shall not havedefaulted in the payment of any of its bonded indebtedness within the ten preceding years. 5. Real estate mortgage bonds. Notes or bonds of any individual secured by a first mortgage on improved real estate located in this state, provided the aggregate amount ofsuch notes or bonds secured by such first mortgage, does not exceed fifty percent of thevalue of the mortgage property as determined by the fiduciary; any such loan may be madein an amount not to exceed seventy-five percentum of the appraised value of the real estateoffered as security and for a term not longer than twenty years if the loan is secured by anamortized mortgage, deed of trust, or other such instrument under the terms of which theinstallment payments are sufficient to amortize the entire principal of the loan within theperiod ending on the date of its maturity. 6. Corporate mortgages. ch instrument under the terms of which theinstallment payments are sufficient to amortize the entire principal of the loan within theperiod ending on the date of its maturity. 6. Corporate mortgages. Notes or bonds of any corporation secured by a first mortgage on improved real estate located in this or any adjoining state upon which no default inpayment of principal or interest shall have occurred within five preceding years provided theaggregate amount of such notes or bonds secured by such first mortgage does not exceedfifty percent of the value of the mortgage property as determined by the fiduciary. 7. Railroad bonds. Bonds of any railroad corporation which are secured by a first lien mortgage or trust deed upon not less than one hundred miles of main track in the UnitedStates and which mortgage or trust deed has been outstanding not less than fifteen years andupon which bonds issued thereunder there has been no default in the payment of principalor interest since the date of said such trust deed. 8. Bonds guaranteed by railroad. Bonds of any corporation secured by a first lien upon any railroad terminal depot, tunnel, or bridge in the United States used by two or date of said such trust deed. 8. Bonds guaranteed by railroad. Bonds of any corporation secured by a first lien upon any railroad terminal depot, tunnel, or bridge in the United States used by two or morerailroad companies which have guaranteed the payment of principal and interest of suchbonds and have otherwise covenanted or agreed to pay the same, provided at least one ofsaid railroad companies meets the following requirements: a. Has earned net income equal to at least four percent of the par value of its outstanding capital stock for five preceding years, and b. Has regularly and punctually paid interest and maturing principal on all of its mortgage indebtedness for five preceding years. Sat Dec 23 12:18:42 2023 Iowa Code 2024, Section 636.23 (25, 0) §636.23, SURETIES — FIDUCIARIES — TRUSTS — INVESTMENTS 2 c. Has outstanding capital stock of the par value of at least one-third of its total mortgage indebtedness. 9. Public utility bonds. Bonds of any corporation supplying either water, electric energy, or artificial manufactured gas or two or more thereof for light, heat, power, water, or otherpurposes, or furnishing telephone or telegraph service, provided that such bonds are ter, electric energy, or artificial manufactured gas or two or more thereof for light, heat, power, water, or otherpurposes, or furnishing telephone or telegraph service, provided that such bonds are securedby a first mortgage on all property used in the business of the issuing corporation or by afirst and refunding mortgage containing provision for retiring all prior liens, and providedfurther, that the issuing corporation is incorporated within the United States, and if operatingentirely outside this state is operating in a state or other jurisdiction having a public utilitiescommission with regulatory powers, and providing such operating corporation has annualgross earnings of at least one million dollars, seventy-five percent of which gross earningshave come from the sale of water, gas, or electricity, or the rendering of telephone or telegraphservice and not more than fifteen percent from any other one kind of business and whichcorporation has a record on its behalf or for its predecessors or constituent companies, ofhaving officially reported net earnings at least twice its interest charges on all mortgageindebtedness for the period of five years immediately preceding the predecessors or constituent companies, ofhaving officially reported net earnings at least twice its interest charges on all mortgageindebtedness for the period of five years immediately preceding the investment and havingoutstanding stock the book value of which is not less than two-thirds of its total funded debt,and which corporation shall have all franchises to operate in the territory it serves in whichat least seventy-five percent of its gross income is earned, which franchise shall extend atleast five years beyond the maturity of such bonds or which have indeterminate permits oragreements with duly constituted public authorities, or in the bonds of any constituent orsubsidiary company of any such operating company which are secured by a first mortgageon all property of such constituent or subsidiary company, provided such bonds are to beretired or refunded by a junior mortgage, the bonds of which are eligible hereunder. 10. Savings associations. Shares of federal savings associations organized under the laws of the United States of America. 11. Bonds and debentures guaranteed by the federal government. le hereunder. 10. Savings associations. Shares of federal savings associations organized under the laws of the United States of America. 11. Bonds and debentures guaranteed by the federal government. Bonds, debentures, or other interest-bearing obligations, the payment of which is guaranteed by the United Statesof America. 12. Stock in federal government instrumentalities. Stock in any association or corporation created or which may be created by authority of the United States and asan instrumentality of the United States, when the purchase of said stock is necessary orrequired as an incident or condition of obtaining a loan from any association or corporationcreated or which may be created by authority of the United States and as an instrumentalityof the United States. 13. Life, endowment or annuity contracts of legal reserve life insurance companies authorized to do business in Iowa. The purchase of contracts authorized by this subsectionshall be limited to executors or the successors to their powers when specifically authorizedby will, and to guardians and trustees, in an amount not to exceed twenty-five percent of thevalue of the ward’s property in possession of the fiduciary. s to their powers when specifically authorizedby will, and to guardians and trustees, in an amount not to exceed twenty-five percent of thevalue of the ward’s property in possession of the fiduciary. Such contract may be issued onthe life or lives of a ward or wards or beneficiary or beneficiaries of a trust fund created bywill or trust agreement, or upon the life or lives of persons in whose life or lives such wardor beneficiary has an insurable interest. The proceeds or avails of such contract shall be thesole property of the person or persons whose funds are invested therein. 14. Limitation as to court-approved investments. This section does not prohibit investment of such funds in a savings account or time certificate of deposit of a bank orsavings association located within the city or its county of this state and when first approvedby the court. However, a city that is the trustee of a cemetery as provided in section 523I.508may invest perpetual care funds in a savings account or certificates of deposit at a banklocated in this state without court approval. 15. When court approval not required. rovided in section 523I.508may invest perpetual care funds in a savings account or certificates of deposit at a banklocated in this state without court approval. 15. When court approval not required. Nothing in this section contained shall be construed as modifying the probate code nor be construed as requiring investments oftrust funds by fiduciaries to be reported to any court or judge for approval where the trustagreement or other document under which the fiduciary is acting is not being administeredunder the jurisdiction of any court or by its terms specifically exempts the fiduciary fromreporting any such investments for approval. Sat Dec 23 12:18:42 2023 Iowa Code 2024, Section 636.23 (25, 0) 16. Investments included — government obligations. Federal bonds, federal bank bonds, and bonds and debentures guaranteed by the federal government which are authorizedinvestments under subsections 1, 2, and 11 include investments in an investment companyor investment trust registered under the federal Investment Company Act of 1940, 15 U.S.C.§80a-1 et seq., the portfolio of which is limited to the United States government obligationsdescribed in subsections 1, 2, and 11 and to ed under the federal Investment Company Act of 1940, 15 U.S.C.§80a-1 et seq., the portfolio of which is limited to the United States government obligationsdescribed in subsections 1, 2, and 11 and to repurchase agreements fully collateralized bysuch United States government obligations, if the investment company or investment trusttakes delivery of the collateral either directly or through an authorized custodian. [C51, §2507; R60, §4115; C73, §251; C97, §364; S13, §364; C24, 27, 31, 35, 39, §12772; C46, 50, 54, 58, 62, 66, 71, 73, 75, 77, 79, 81, §682.23] 86 Acts, ch 1032, §2; 89 Acts, ch 296, §85C93, §636.232005 Acts, ch 128, §72; 2012 Acts, ch 1017, §154; 2014 Acts, ch 1092, §194; 2020 Acts, ch 1063, §365 Referred to in §37.24, 468.151, 523I.602, 636.24, 636.25, 636.26See §633.127, 633A.4302Institutional funds, investment authority; §540A.103 Sat Dec 23 12:18:42 2023 Iowa Code 2024, Section 636.23 (25, 0)
Iowa Legal Code