having resources aggregating more than $5,000,000, can legally serve at the same time as director of any national bank or Edge Corporation, regardless of its location. 3-No person can legally be a director, officer, or employee of a national bank or Edge Corporation located in a city of more than 200,000 inhabitants who is at the same time a private banker in the same city or a director, officer, or employee of any other bank (state or national) located in the same city, regardless of the size of such bank. The eligibility of a director, officer, or employee under the foregoing provisions is determined by the average amount of deposits, capital, surplus, and undivided profits as shown in the official statements of such bank, banking association, or trust company filed as provided by law during the fiscal year next preceding the date set for the annual election of directors, and when a director, officer, or employee has been elected or selected in accordance with the provisions of the Clayton Act it is lawful for him to continue as such for one year thereafter under said election or employment. When any person elected or chosen as a director, officer, or employee of any bank is eligible at the time of his election or selection to act for such bank in such capacity his eligibility to act in such capacity is not affected by reason of any change in the affairs of such bank from whatsoever cause, until the expiration of one year from the date of his election or employment. Exceptions: 1-The provisions of the Clayton Act do not apply to mutual savings banks not having a capital stock represented by shares. 2-Do not prohibit a person from being at the same time a director, officer, or employee of a national bank or Edge Corporation and not more than one other national bank, Edge Corporation, State bank, or trust company, where the entire capital stock of one is owned by the stockholders of the other. 3-Do not prohibit a person from being at the same time a class A director of a Federal Reserve Bank and also an officer or director, or both an officer and a director, in one member bank. 4-Do not prohibit a person who is serving as director of a national bank, or Edge Corporation, even though it has resources aggregating over $5,000,000, from serving at the same time as director of any number of state banks and trust companies, provided such state institutions are not located in the same city of over 200,000 5-Do not prohibit a person from serving at the same time as director, 9-Do not apply to persons who have obtained the consent or approval These exceptions are cumulative. Permission of the Federal Reserve Board By the Kern amendment the Clayton Act now authorizes the Federal Reserve Board to permit any private banker or any officer, director, or employee of any member bank or class A director of a Federal Reserve Bank to serve as director, officer, or employee of not more than two other banks, banking associations, or trust companies coming within the prohibitions of the Clayton Act, provided such other banks are not in substantial competition with such private banker or member bank. Substantial competition-If the institutions involved are not in substantial competition, the Board is authorized, in its discretion, to grant, withhold, or revoke such consent; but if they are in substantial competition, the Board has no discretion in the matter and must refuse such consent. When obtained-Inasmuch as the Kern amendment excepts from the prohibitions of the Clayton Act only those "who shall first procure the consent of the Federal Reserve Board," it is a violation of the law to serve two or more institutions in the prohibited classes before such consent has been obtained. Such consent should be obtained, therefore, before becoming an officer, director, or employee of more than one bank in the prohibited classes. Such consent may be procured before the person applying there for has been elected as a class A director of a Federal Reserve Bank or as a director of any member bank. Approval or disapproval-As soon as an application is acted upon by the Board, the applicant will be advised of the action taken. If the Board approves the application, a formal certificate of permission to serve on the banks involved will be issued to the applicant. Rehearing-If the Board decides that the banks are in substantial competition and that it cannot approve the application, it will, upon petition of the applicant, reconsider its decision and afford him every opportunity to present any additional facts or arguments bearing on the subject. Effect of permits-Permission once granted is continuing until revoked, and need not be renewed. Revocation-All permits, however, are subject to revocation at any time in the discretion of the Federal Reserve Board. The issuance of a permit to any person shall have the effect of revoking any or all permits which may have been issued previously to that person. Permits under Section 25 of the Federal Reserve Act WITH the approval of the Federal Reserve Board, any director, officer, or employee of a member bank which has invested in the stock of any corporation principally engaged in international or foreign banking or financial operations or banking in a dependency or insular possession of the United States, under the provisions of section 25 of the Federal Reserve Act, may serve as director, officer, or employee of any such foreign bank or financial corporation. Applications for approval-The approval of the Federal Reserve Board for such interlocking directorates may be obtained through an informal application in the form of a letter addressed to the Federal Reserve Board either by the officer, director, or employee involved, or in his behalf by one of the banks which he is serving. Such application should be sent directly to the Federal Reserve Board. Permits to Serve Edge Corporations WITH the approval of the Federal Reserve Board 1-Any officer, director, or employee of any member bank may serve at the same time as director, officer, or employee of any Edge Corporation in whose capital stock the member bank shall have invested. 2-Any officer, director, or employee of any Edge Corporation may serve at the same time as officer, director, or employee of any other corporation in whose capital stock such Edge Corporation shall have invested under the provision of the Edge Act. Applications for approval-Such approval may be obtained through an informal application in the form of a letter addressed to the Federal Reserve Board either by the director, officer, or employee involved, or in his behalf by one of the banks or corporations involved. Such applications should be sent directly to the Federal Reserve Board. B BANKS AS INSURANCE AGENTS Y an amendment to the Federal Reserve Act national banks located in any place the population of which does not exceed 5,000 (last decennial census) may act as the agents for fire insurance, life insurance, or other insurance campanies, under the following provisions: (a) The insurance company for which the bank acts must be authorized by state authorities to do business in the state in which the bank is located. (b) The bank's activities as insurance agent are restricted to the soliciting and selling of insurance and collection of premiums. (c) The bank may receive such lawful fees as are agreed upon between itself and the insurance company. (d) The bank must not assume or guarantee the payment of any payment on insurance policies. (e) The bank must not guarantee the truth of any statement made by the person who is insured. In pursuance of the powers conferred upon him by the law the Comptroller has prescribed a set of regulations for national banks which act as insurance agents, which are furnished upon request. No national bank can act as an insurance agent if the laws of the state in which it is located will not permit any bank to so act, nor unless it conducts its business under the rules that are prescribed by the Comptroller. |