August 29, 2003
Regulations Comments
Federal Deposit Insurance Corporation
550 17th St. NW
Washington, DC 20429
Subject: Regulations on Insuring Living Trust Accounts
Dear Sir or Madam:
Principal Bank appreciates the opportunity to comment on the proposed
rule to clarify the regulations on insuring living trust accounts.
Introduction. Principal Bank is a FDIC insured savings bank with a
home office in Des Moines, Iowa, and is a member of Principal Financial
Group. Principal Bank's focus is on electronic banking and it does not
utilize a traditional "brick and mortar" branch strategy. Our
distribution channels include the Internet, a call center and mail.
Principal Bank was chartered in February 1998 under a federal charter
and is regulated by the Office of Thrift Supervision (OTS).
Principal Financial Group (The Principal®) is a leading global
financial institution offering businesses, individuals and institutional
clients a wide range of financial products and services including
retirement and investment services, life and health insurance and
mortgage banking. Headquartered in Des Moines, Iowa, The Principal®
serves more than 13 million customers worldwide from offices in Asia,
Europe, Latin America and the United States.
Background. This letter provides Principal Bank's comments on
proposed changes to living trust accounts. As the living trust is an
increasingly popular probate instrument, there is a high demand to
simplify the regulations so as to achieve specific estate and tax
planning goals. Our Bank recognizes the need for clarification for
insuring such account.
Principal Position. We feel the most suitable clarification would be
Proposed Rule—Alternative One. With the continuing increase of
inter-generational insuring, it seems appropriate we offer our customers
the most FDIC insurance coverage available. In addition, because the coverage would no longer
depend on defeating contingencies in the trust, depositors would have a
clear understanding of their account coverage. Alternative One provides
the amount of coverage and the clarity and understanding of living trust
accounts that our customers deserve.
Your consideration of these comments is greatly appreciated. If you
have any questions, or would like any additional information please do
not hesitate to call me.
Sincerely,
Joel S. Hjelmaas
VP and Chief Compliance Officer
Principal Bank, Des Moines, IA
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