BANK DIRECTOR EDUCATION CERTIFICATION

Requirements for Certificate of Completion

The educational program leading to a Certificate of Completion is designed to provide individuals with the basic information they will need to serve as directors of a bank or savings institution, and may facilitate discounts on premiums paid for D&O Insurance.

To fulfill the requirements for a Certificate of Completion, an individual must, during the first calendar year in the program, complete:

• a process that includes participation in a six-hour Core Course
• participation in a six-hour Supplemental Course selected from the Course Guide or pre-approved by IBDE.

(NOTE: IBDE certification is only open to members in good standing of the American Association of Bank Directors.)

A Core Course will cover the following topics:

• Corporate governance/fiduciary duties - What are a bank director's responsibilities, how should the Board of Directors govern itself to help it do the job it is required to do, how to avoid or address conflicts of interest, how to manage communications between senior management and the Board of Directors, and what are the keys to Board independence?
• Essential Board reports, financial statements, bank performance reports, and reports of examination - what are they and how to read and understand them?
• Red flags - what are they, how to become aware of them, and what to do about them?
• Understanding external audit, internal audit, internal controls, and the role of the Audit Committee
• Lending and the role of the Board and loan committees
• Asset/liability management and bank investments
• Risk management principles - what do the bank regulators expect, and what does the Board need to do?
• The Board's role in strategic planning, the offering of new products, and the use and control of third party vendors, suppliers, contractors and partners
• Evaluating the CEO and the Board - the Board's toughest but most important role, and selection and nomination of new board members
• Director and officer compensation and Board oversight responsibilities
• Basic bank legal and regulatory rules that all bank directors need to know (e.g., Regulation O, Sections 23A and 23B of the Federal Reserve Act, and lending limits)
• Consumer compliance issues from a Board oversight perspective
• Bank Secrecy Act and USA PATRIOT programs and the role of the Board
• Steps to minimize personal liability

Supplemental Courses cover a wide range of topics that are of value to bank directors. Recent offerings have included:

• Executive compensation
• Mutual fund activities of banks
• Regulatory compliance for financial institution directors
• The power of community banking

Requirements for Certificate of Maintenance

The educational program leading to an annual Certificate of Maintenance is designed to provide individuals with valuable supplemental knowledge they will need to serve as directors following their receipt of a Certificate of Completion.

To fulfill the requirements for an annual Certificate of Maintenance, an individual must participate, on an annual basis, in Supplemental Courses which, in the aggregate, represent at least 6 hours of credit. The supplemental course(s) must be selected from the Course Guide or pre-approved by IBDE.