How to name beneficiaries and fund a trust at Cathay Bank

A Totten Trust account is an informal trust reflected on bank records with no written trust agreement. The owner holds it as trustee, the beneficiaries have no right to the funds during the owner's lifetime, and they take ownership at the owner's death.¹

Cathay Bank offers Totten Trust accounts on accounts domiciled in CA, IL, MA, MD, NY, NV and WA. A Totten Trust is a payable-on-death arrangement, not a funded living trust.¹

An IRA CD beneficiary change requires a separate IRA beneficiary designation form. The deposit-account P.O.D. designation does not carry over to an IRA.²

When more than one beneficiary or payee is named, the owner gives an allocation percentage for each.³

The signed, written direction is what makes a designation or change effective. A phone call alone does not change a P.O.D. payee.¹

For payable-on-death accounts. Sent by the institution on request.²

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For IRAs. Sent by the institution on request.²

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Under the Deposit Account Agreement, a P.O.D. payee may be changed only "by written direction to us," and the Totten Trust clause uses the same words for changing a beneficiary.¹

The Deposit Account Agreement requires the owner to notify Cathay Bank of the death of any account holder, authorized signer or designated beneficiary, including a beneficiary the owner named.¹

Cathay Bank digital banking does not support adding or changing P.O.D. payees, Totten Trust beneficiaries or IRA beneficiaries.²

For an account domiciled in California, the interest of each surviving P.O.D. payee is deemed to be in equal shares unless the bank's records say otherwise.¹

For an account domiciled in Massachusetts, the interest of each surviving P.O.D. payee is deemed to be in equal shares unless the bank's records say otherwise.¹

For an account domiciled in Maryland, the interest of each surviving P.O.D. payee is deemed to be in equal shares unless the bank's records say otherwise.¹

For an account domiciled in Washington, the interest of each surviving P.O.D. payee is deemed to be in equal shares unless the bank's records say otherwise.¹

The agreement states that a Washington resident may be entitled to dispose of accounts by will, that the right may be waived, and that an effective disposition by will overrides an earlier beneficiary designation under the agreement.¹

For an account domiciled in Illinois, surviving P.O.D. payees hold in equal shares as tenants in common with no right of survivorship. If no payee survives the last account holder, the proceeds vest in that holder's estate.¹

Accounts domiciled in New Jersey are governed by New Jersey law. Cathay Bank may pay out the entire balance on a set-off, levy, court order, or a bankruptcy or insolvency representative's request relating to the interest of any one party, and need not determine net contributions.¹

Accounts domiciled in Nevada are owned by the parties in proportion to their net contributions.¹

Accounts domiciled in Texas use the Texas Uniform Single/Multiple Party Account Selection Form signed at account opening.¹

The Deposit Account Agreement defines a Formal Trust Account as an account held by one or more trustees for the benefit of one or more beneficiaries according to a written trust agreement.¹

IRA CDs cannot be retitled to a trust.²

Sent by the institution on request.²

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A trust can open a new account with the trust account application, or an existing personal account can be retitled into the trust by written notice of the ownership change under Section 4 of the Deposit Account Agreement.¹

Cathay Bank may require a new signature card or other documentation before an ownership change takes effect.¹

Cathay Bank may require additional certifications and documentation to support any change in the trust agreement or the opening of additional accounts by the trust.¹

A new or updated signature card does not by itself end a pre-existing automatic payment or transfer plan. Cathay Bank may keep honoring instructions from a previously authorized person until it receives written notice not to.¹

Trust account setup and retitling are handled in a branch. Cathay Bank does not open or retitle trust accounts through its digital banking platform.²