A Current Member of the Board of Directors at First

question 190

Multiple Choice

A current member of the board of directors at First Savings Association (an institution with $150 million in total assets) was a director at First National Bank (an institution with total assets of $200 million) for many years. The two institutions are located in the same town. Before being elected to the board of First Savings, the director retired from the First National board. To honor his years of service with First National, the bank made him a director emeritus for life. He can attend any board meeting but cannot vote. He may speak to matters before the board and receives a director's fee. In actuality, however, the director never attends board meetings. Does this relationship violate Regulation L?

• A) No, because he does not attend meetings.
• B) No, because he cannot vote.
• C) Yes, because he receives a fee.
• D) Yes, because he is really an honorary director.

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Definitions:

Evolution

The process through which species of organisms undergo change over time through variations in hereditary traits and natural selection.

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