Topic: Bank Governance
-
If we use a branch name for some branches (in conjunction with our bank’s legal name), should loan documents use the branch name or just the bank’s legal name?
—
by
We would recommend using the bank’s legal name for all legal documents, including loan agreements, as required by the FFIEC’s Interagency Statement: Branch Names. The legal name is a bank’s “full name as reflected in its charter.” We also note that nothing in Illinois or federal law requires you to register a divisional or trade…
-
Can a bank provide third party review as a consultant?
—
by
We believe that the answer is yes, although there should be a strong written agreement that creates an agency relationship and provides firewalls with respect to disclosures of financial information. We’re pretty sure that a number of unrelated banks in the past few years have combined personnel for compliance purposes. Having said all that, the…
-
Do you know if Illinois banks are still required to have a “cashier”?
—
by
The National Banking Act requires that all national banks “elect and appoint directors, and by its board of directors to appoint a president, vice president, cashier, and other officers.” 12 USC 24(5). (OCC publications use the terms “cashier” and “chief financial officer” interchangeably (for example, in its New Bank Organization Checklist, available here), so this…
-
Can a bank change its bylaws so that directors can attend meetings telephonically and take actions informally?
—
by
Section 43 of the Illinois Banking Act authorizes boards to take informal action by written consent, and IDFPR Interpretive Letter 2002-08 (June 12, 2002) authorizes meetings by electronic means. 205 ILCS 5/43. Further, Section 5 of the Illinois Banking Act allows Illinois banks “[t]o make, alter, amend, and repeal bylaws, not inconsistent with its charter…
-
One of the stockholders of our banking company requested a list of all shareholders and their ownership shares. Are we required to comply with this request?
—
by
Illinois law allows any shareholder to inspect shareholder records, including shareholder names, addresses, and the number and class of shares held by each, “but only for a proper purpose.” The shareholder must make a written request stating “with particularity the records sought to be examined and the purpose therefor.” 805 ILCS 5/7.75(b). A person who…