Bank Management

2. A Bank is formed as a corporate
entity. Hence, the stockholders who
are part-owners of the business
have to delegate their power of
management to a board of directors.

3.  The board of directors will be composed of a
number agreed upon as contained in the by-
laws, but in no case should it exceed the
number allowed by law.
 In small banks, the chairman of the board and
the president may only be one person in order
to achieve harmony, efficiency, and economy.

4. Every director shall own at least one (1) share
of the capital stock of the corporation of
which he is director; the share stand in his
name in the book books of the corporation.
a. Educational attainment,
b. Adequate competency and
understanding of business,
c. Age requirement,
d. Integrity/probity, and
e. Assiduousness.

5.  The Responsibilities of the board of directors are
threefold. Firstly, they are duty-bound to adopt
measures that shall safeguard the depositor’s interest.
Secondly they must be sure to compensate the
stockholders fairly enough in exchange for the risk
they undertake and the capital they invest. Thirdly, the
directors are responsible to the regulatory and
supervisory agencies who keep surveillance over the
management of the bank’s affairs to allow maximum
safety to depositors and also to give widest and best
kind of service to the public.

6.  The Executive Committee- This committee deals with
administration matters.
 The Loans and Discount Committee- All matters
pertaining to loans and discounts , to lines of credits, and
others related to the loaning function of a bank are
deliberated on by this committee.
 The Investment Committee- This committee concerns
itself with the bank’s investment portfolio.
 The Trust Committee- The fiduciary function of a bank will
be the main concern of this committee.
 The Examination Committee- In order that the bank will
always be in shipshape condition regarding its operations,
the internal examination and audit of its accounts is an
essential feature of good management.

7. The liabilities of directors
shall arise from their
incompetence and negligence
in the discharge of their
duties.

8. Directors may be prohibited from
doing some acts, which will either
impair or jeopardize the bank’s
good relations with the public. A
director might be required to
inhibit himself from deliberating
on a loan where he is directly or
indirectly interested.

9.  55.1. No director, officer, employee, or agent of any bank shall:
a.) Make false entries in any bank report or statement or participate in
any fraudulent transaction, thereby affecting the financial interest of, or
causing damage to, the bank or any person;
b.) Without order of a court of competent jurisdiction, disclose to any
unauthorized person any information relative to the funds or properties
in the custody of the bank belonging to private individuals.
c.) Accept gifts, fees, commissions, or any other form of
remuneration in connection with the approval of a loan or other credit
accommodation from said bank’;
d.) Overvalue or aid in overvaluing any security for the purpose of
influencing in any way the action s of the bank or any bank; or
e.) Outsource inherent banking functions.

10. The officers of a bank consist of a
president, one or more vice
president, a cashier, and some
other officers as provided for in the
by-laws.

11. President are held by one
person. Held by separate
person, however ,the chairman
presides at the board meeting
while the president becomes the
chief executive or the general
manager of the bank.

12. The vice- president assists the
president when the latter is
present. However, when president
is absent or incapacitated, the vice-
president takes over his duties and
responsibilities.

13. The cashier often doubles
up as the chief clerk, the
secretary, and the
treasurer of the bank.

14. Other officers of the bank may
be the comptroller and the
auditor. And are also
responsible for the efficient and
harmonious administration of
their duties.

16.  Executive – faced with policy-making,
with establishing harmonious relations
with customers in order to get
business, with gathering facts and
figures about the depositors and
debtors, with recruiting personnel to
do the minor operations , and with
similar duties involving the caliber of
an executive.

17. He accepts deposits, he changes
checks for cash, he changes big
bills with denominations, he
releases the checks or cash
representing loan receives
payments for loans, and such
other tellers functions.

18. He keep faithful record of the
events and accounts passing
though his hand, the banker
must record the figures and
sometimes facts.

19. He should be patient,
understanding, cordial, and
respectful. He should be
well-versed in banking
principles and practices.