Ky. Rev. Stat. » Chapter 286
Kentucky Revised Statutes

Ky. Rev. Stat. § 286.3-277 (2026)

Standards for bank or trust company acting as fiduciary

✓ current as of May 2026
Find cases: SyfertCases citing this section KY-LRCapps.legislature.ky.gov JustiaChapter on Justia CornellLII Search CasesGoogle Scholar

(1) Notwithstanding the provisions of any other law, a bank empowered to act as a fiduciary or trust company, when investing, reinvesting, purchasing, acquiring, exchanging, selling, and managing property held in a fiduciary capacity, shall act as a prudent investor would, in light of the purposes, terms, distribution requirements, and other circumstances of the fiduciary account.

(2) The standard described in subsection (1) of this section requires the exercise of reasonable care, skill, and caution, and is to be applied to investments not in isolation but in the context of the account portfolio and as part of an overall investment strategy, which should incorporate risk and return objectives reasonably suitable to the account.

(3) In making and implementing investment decisions, the bank or trust company has a duty to diversify the investments of the account unless, under the circumstances, it is prudent not to do so.

(4) In addition, the bank or trust company shall:

(a) Conform to fundamental fiduciary duties of loyalty and impartiality;

(b) Act with prudence in deciding whether and how to delegate authority and in the selection and supervision of agents; and

(c) Incur only costs that are reasonable in amount and appropriate to the investment responsibilities of the account.

(5) The duties of the bank or trust company under this section are subject to the rule that in investing the funds of the account, the bank or trust company:

(a) Has a duty to the beneficiaries of the account to conform to any applicable statutory provisions governing investment by fiduciaries; and

(b) Has the power expressly or impliedly granted by the terms of the account or applicable instrument and has a duty to the beneficiaries of the account to conform to the terms of the account directing or restricting investments by the bank or trust company. Effective: July 15, 1996 History: Created 1996 Ky. Acts ch. 338, sec. 6, effective July 15, 1996. Formerly codified as KRS 287.277. Legislative Research Commission Note (7/12/2006). In accordance with 2006 Ky. Acts ch. 247, secs. 38 and 39, this statute has been renumbered as a section of the Kentucky Financial Services Code, KRS Chapter 286.

Notes of Decisions
Cited in 4 cases (1 in the last 5 years), 2008–2025 · leading case: Anderson v. Old Nat'l Bancorp, 675 F. Supp. 2d 701 (W.D. Ky. 2009).
Sort: Relevance Newest Treatment
Anderson v. Old Nat'l Bancorp, 675 F. Supp. 2d 701 (W.D. Ky. 2009). · cites it 12× “The trust language does not contradict KRS § 286.3-277. Inversely, Kentucky statutory law does not invalidate the trust language.”
Knight v. Comm'r, 552 U.S. 181 (2008). “See Ky. Rev. Stat. Ann. § 286.3-277 (Lexis 2007 Cum.”
Jarvis v. Nat'l City, 410 S.W.3d 148 (Ky. 2013). · cites it 2× “See KRS 286.3-277(1); see also KRS 386.454 (allowing fiduciary who is not a bank or institution to elect to have prudent investor standard apply); KRS 386.”
Brett Kincaid v. Michael D. Foley, Member of the Advisory Comm. Fund C Created Under the Trust Agreement of Garvice D. Kincaid, Dated February 26, 1964, as Amended (Ky. Ct. App. 2025). · cites it 2× “Additionally, the court believed that “[c]onsideration of the ‘sound’ and ‘prudent’ language in the [2007] settlement agreement implicates the higher standard of the prudent investor as codified in KRS 286.3-277[.]” January 31, 2022, Order at 4.”
Ky. Rev. Stat. § 286.3-277(1): 1 case
Jarvis v. Nat'l City, 410 S.W.3d 148 (Ky. 2013). “See KRS 286.3-277(1); see also KRS 386.454 (allowing fiduciary who is not a bank or institution to elect to have prudent investor standard apply); KRS 386.”
Ky. Rev. Stat. § 286.3-277(2): 1 case
Jarvis v. Nat'l City, 410 S.W.3d 148 (Ky. 2013). “See KRS 286.3-277(1); see also KRS 386.454 (allowing fiduciary who is not a bank or institution to elect to have prudent investor standard apply); KRS 386.”
Ky. Rev. Stat. § 286.3-277(3): 1 case
Brett Kincaid v. Michael D. Foley, Member of the Advisory Comm. Fund C Created Under the Trust Agreement of Garvice D. Kincaid, Dated February 26, 1964, as Amended (Ky. Ct. App. 2025). “Additionally, the court believed that “[c]onsideration of the ‘sound’ and ‘prudent’ language in the [2007] settlement agreement implicates the higher standard of the prudent investor as codified in KRS 286.3-277[.]” January 31, 2022, Order at 4.”
Annotations are extracted automatically from the opinions in the Syfert caselaw corpus and ranked by authority, recency, and treatment. Dots show Syfertize treatment of the citing case itself.