USA Law and Practice Contributed by: Edward P. O’Keefe, Neil T. Bloomfield, John A. Stoker and Kathryn (Kate) G. Wellman, Moore & Van Allen, PLLC
procedures for the management of risk at the firm and processes and systems for implement - ing and monitoring compliance with risk man - agement policies and procedures. State-chartered Banks State-chartered banks would be subject to any corporate governance requirements established by applicable state laws or regulations. 4.2 Registration and Oversight of Senior Management As part of the licensing process for a national bank charter, the OCC will evaluate the qualifica - tions of the organisers, directors, and executive officers, considering their familiarity with bank - ing laws and regulations as well as their expe - rience with the expected business activities of the bank. The OCC must also review the hiring of new senior executive officers or the election of new directors for at least the first two years of the bank’s operations. Thereafter, the bank must provide the OCC with at least 90 days prior notice in the event of additions or changes to its board of directors and senior executive officers (or adding a new senior executive officer role to the responsibilities of an existing senior execu - tive officer) if the bank is not in compliance with its minimum capital requirements, has been noti - fied by the OCC to do so, or has been deter - mined to be in troubled condition. Any required notice must include biographi - cal and financial information, employment and compensation arrangements, fingerprint checks, tax check waivers, and consent to a background check. The OCC may disapprove of any member of the board or new senior executive officer (or change in their role). Management officials of a bank are also generally prohibited from serving as a management official of an unaffiliated bank
if the management interlock would likely have an anti-competitive effect. Residency and Citizenship Requirements for Directors of National Banks Unless a waiver is requested by the bank and granted by the OCC, directors of national banks must be citizens of the United States. Waiv - ers are discretionary, but non-US citizens may not make up more than a minority of the total number of directors on the board. In connec - tion with a waiver request, the bank must submit biographical, financial, and other information on the director. A majority of directors must also be a resident of the state where the bank is located or within 100 miles of the bank’s designated main office for at least one year prior to their election and during their service. The OCC may waive this requirement in its discretion and with no limit on the number of waivers granted. Roles and Responsibilities of Bank Directors and Senior Management The board of a national bank is accountable for the oversight of the bank’s management, provi - sion of leadership to the bank, and establishment of the bank’s values. The board is also responsi - ble for creating a risk governance framework for the bank and setting the bank’s strategic direc - tion and its appetite for risk. While the board is responsible for strategic direction and oversight, senior management is responsible for the day-to-day running of the bank’s operations. The board should hold management accountable for accomplishing the bank’s strategic objectives while operating within an approved risk appetite framework. The board carries out its responsibilities by exercis - ing informed and independent judgement and
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