What must a national bank establish regarding collateral securities when holding cash in trust?

The requirement for a national bank to establish specific standards regarding collateral securities when holding cash in trust is dictated by regulatory guidance, specifically 12 CFR 9.10(b). This regulation outlines the necessary standards that a national bank must follow when it comes to the administration of trust funds and the management of collateral securities. Compliance with these standards ensures that the bank is acting in a fiduciary capacity and protecting the interests of the trust beneficiaries.

By adhering to the standards set forth in 12 CFR 9.10(b), the bank ensures that the collateral provided is appropriate and secure, contributing to the overall stability and trustworthiness of the fiduciary activities the bank undertakes. Furthermore, this compliance reinforces regulatory oversight, protecting both the bank and the clients it serves.

Other options reference varying aspects of collateral management and trust operations, but none align specifically with the established legal framework provided by the mentioned regulation, making it clear that option B correctly identifies the necessary compliance requirement for national banks holding cash in trust.