{"id":518,"date":"2018-12-25T11:18:39","date_gmt":"2018-12-25T10:18:39","guid":{"rendered":"https:\/\/advokatskafirmasajic.com\/blog\/?p=518"},"modified":"2019-10-05T11:20:48","modified_gmt":"2019-10-05T09:20:48","slug":"members-of-a-bank-governing-bodies","status":"publish","type":"post","link":"https:\/\/advokatskafirmasajic.com\/blog\/members-of-a-bank-governing-bodies\/","title":{"rendered":"MEMBERS OF A BANK GOVERNING BODIES"},"content":{"rendered":"\n
  1. Decision on conscientious behavior of members of a bank governing bodies <\/li><\/ol>\n\n\n\n

    Decision on conscientious behaviour of members of a bank governing\nbodies, issued by the Banking Agency of the Republic of Srpska on 25.07.2017 (published\nin the “Official Gazette of the Republic of Srpska”, number 75\/17)\ndefines the rules of procedure for members of those bodies in the Republic of\nSrpska, as well as the criteria related to determining conflicts of interest\nand establishment of specialized boards of a bank.<\/p>\n\n\n\n

    1. Rules of\nconscientious behaviour (basic and additional)<\/li><\/ol>\n\n\n\n

      Basic rules of conscientious behaviour of members of governing bodies of\na bank<\/p>\n\n\n\n

      A member of any bank governing body is obliged to act in accordance with\nthe highest professional and ethical standards of bank management, acting in\nthe interest of the bank and preventing to the highest extent decision-making\nbased on personal interests. He\/she is obliged to promote culture through\nhis\/her behaviour, giving the highest priority to professional, fair and\nconscientious conduct of business activities at all organisational levels, and\nclearly defined, transparent and consistent lines of responsibility and\nauthority within the organisational structure.<\/p>\n\n\n\n

      Members of a bank governing bodies are obliged to apply professional and\nethical management standards in order to achieve a balance between the interest\nof the bank, its bodies, clients, creditors, shareholders, employees,\nsupervisors, regulators and other stakeholders. <\/p>\n\n\n\n

      A member of the Board of Directors and a member of the Supervisory Board\nmust perform his\/her duties professionally and conscientiously, with an\nobligation to establish procedures and mechanisms for disposing of privileged\ninformation for his\/her account and account of third parties.<\/p>\n\n\n\n

      In the course of performance of their duties and responsibilities,\nmembers of boards are obliged to cooperate with each other in the best\ninterests of the bank. <\/p>\n\n\n\n

      In the event that the bank is a member of a banking group, the\nSupervisory Board of the bank, in addition to the responsibility for the\ncompliance of the business strategy, the objectives, the risk taking\nstrategies, risk management policies and procedures, with the legal and\nsubordinate regulations, also has the responsibility for controlling compliance\nwith the objectives, strategies and policies adopted at the level of that\nparticular banking group. Members of the Supervisory Board shall be jointly and\nseverally liable for any damage arising as a result of taking or not taking certain\nactions or failure to fulfil their responsibilities, unless they prove that\nwhile performing their duties of supervision of the bank management they acted\nconscientiously and in accordance with professional and ethical standards\nprescribed by the by-laws of the Banking Agency of the Republic of Srpska.<\/p>\n\n\n\n

      A member of a board must have the necessary knowledge and experience to\nmake independent assessments  and decisions in the best interest of the bank. In\ndoing so, the member is required to take into consideration all available\ninformation that may have influence on decision-making process.<\/p>\n\n\n\n

      The Supervisory Board of a bank shall have at least one-third of its\nmembers independent of the bank, i.e. members who have no direct or indirect\nqualified participation in the bank or who are not members of the banking group\nto which the bank belongs, but also not members of the Board of Directors of\nthe bank or any of its affiliated companies for at least five years, then who\nare not employed in the bank or in its affiliated company for at least three\nyears, do not receive any other payment from the bank other than remuneration\nfor work in the Supervisory Board, and finally who are unrelated to the bank on\nany other basis which could prevent an objective and impartial supervision of\nthe bank’s work or its administration.<\/p>\n\n\n\n

      The remuneration of the members of the Supervisory Board of the Bank\nmust be consistent with the bank’s compensation policy and should not stimulate\nthe members of the Supervisory Board to make decisions that may encourage them\nto take any risk that exceeds the level of acceptable bank risk.<\/p>\n\n\n\n

      Additional rules of conscientious behaviour of members of a bank\ngoverning bodies<\/p>\n\n\n\n

      The Board of Directors regularly, comprehensively and in due course\nreports to the Supervisory Board on issues related to bank operations, risk\nprofile of the bank, implementation of adopted policies, possible deviations\nfrom established business policy goals and other issues from its jurisdiction.\nThe Supervisory Board of the Bank has the right and the obligation to request\nadditional explanations and reports from the Board of Directors regarding all\nrelevant business issues of the bank and its affiliates.<\/p>\n\n\n\n

      Members of the Supervisory Board are required to devote sufficient time\nto carry out their duties. During their mandate, they are required to develop\nand improve the necessary collective and individual knowledge, skills and\nprofessional knowledge, through further education in areas that are relevant\nfor the efficient and quality performance of their duties.<\/p>\n\n\n\n

      Once a year, the Supervisory Board of the bank shall conduct a\nself-assessment of its adequacy and assessment of its activities, the work of\nthe Supervisory Board as a whole and the work of its individual members,\npotential conflicts of interest of individual members, functioning of its\nboards and cooperation with the Board of Directors. In accordance with the\nresults of the self-assessment, the Supervisory Board should define possible\nmeasures to improve efficiency in terms of composition, education, dynamics of\nholding sessions and attendance at the same, necessary information, preparation\nfor sessions and the like.<\/p>\n\n\n\n

      An annual report on its work the Supervisory Board shall submit to the\nBank’s Annual General Meeting and the that report specifies precisely and\ncredibly the activates performed during the year, and in particular the\nactivities related to: supervising the operations of the bank and its\nmanagement, assessing the management’s report, assessing the internal audit\nreport and the report of the audit committee, etc.<\/p>\n\n\n\n

      1.2. Specific tasks of members of the Supervisory Board<\/p>\n\n\n\n

      The Supervisory Board of the bank is making a proposal for a business\npolicy, but prior to that assess whether it enables the implementation of the\nbank’s business strategy.<\/p>\n\n\n\n

      The Supervisory Board adopts a proposal of a financial plan which has to\nbe consistent with the bank’s business strategy and policy.<\/p>\n\n\n\n

      In addition, the Supervisory Board should ensure the independency of\ncontrol functions, i.e. it is obliged to establish their functioning separately\nfrom the business processes and activities in which the risk arises.<\/p>\n\n\n\n

      • Decision on\nassessment of members of a bank governing bodies
        • General provisions <\/li><\/ul><\/li><\/ul>\n\n\n\n

          Decision on the assessment of members of a bank governing bodies issued\nby the Banking Agency of the Republic of Srpska on 25.07.2017 (published in the\nOfficial Gazette of the Republic of Srpska, No. 75\/17), provides:<\/p>\n\n\n\n

          1. criteria and\nprocedures for the assessment of the proposed and elected, i.e. appointed\nmembers of the governing bodies in terms of whether they have good reputation\nand sufficient experience to perform the function they are appointed to;<\/li>
          2. the measures\napplied by the bank in cases where the members of those  bodies are uneligible to perform the function\nthey are appointed to;<\/li>
          3. procedure of\nthe Banking Agency of the Republic of Srpska when issuing their consent for\nthose members of the bank governing bodies.<\/li><\/ol>\n\n\n\n
            • Request for assessment<\/li><\/ul>\n\n\n\n

              The bank has the primary responsibility for conducting initial and\ncontinuous assessment of the members of its bodies. All relevant and available\ninformation must be taken into account for the assessment of members,\nregardless of when and where the same originated.<\/p>\n\n\n\n

              Assessments of those\nmembers must be completed before the same\nassume his\/her function, as well as once a year for the previous year of\nperforming the function as a member of the bank governing body. When assessing\nindividual members, the bank carries out an assessment of the body as a whole.\nThe assessment procedure and its results must be adequately documented.<\/p>\n\n\n\n

              If the bank concludes that the person is not eligible for election, i.e.\nappointment after the assessment, that person cannot be elected, i.e.\nappointed. However, if the member is already elected or appointed, the bank\nshall take appropriate measures to ensure dismissal of the same or to ensure\nthe measures that will enable the eligibility of that particular member. If the\nbank concludes on the basis of a re-assessment that a member of the body is no\nlonger eligible, it is obliged to take appropriate measures. These measures may\ninclude: the replacement of certain members of the bank governing body, i.e.\ntheir dismissal; training of an individual member or all members of that body\nand other appropriate measures to ensure satisfactory collective accreditation\nof the bank’s body.<\/p>\n\n\n\n

              • Procedure of the Banking Agency   <\/li><\/ul>\n\n\n\n

                The Banking Agency shall issue a prior consent for the appointment of the president and members of the Board of Directors and the Supervisory Board of the bank if it considers that the proposed candidates fulfill the conditions prescribed by the Banking Law of the Republic of Srpska and bylaws of the Banking Agency, for which the Banking Agency has determined that the bank adequately carried out its assessment of the candidates, and that they are able to demonstrate that they will provide a legitimate, safe and stable operation of the bank, i.e.  will effectively supervise the business operation of the bank.<\/p>\n\n\n\n

                Author: Aleksandar Sajic<\/p>\n\n\n\n

                E-mail: aleksandar@afsajic.com<\/p>\n","protected":false},"excerpt":{"rendered":"

                Decision on conscientious behavior of members of a bank governing bodies Decision on conscientious behaviour of members of a bank governing bodies, issued by…<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[89],"tags":[],"_links":{"self":[{"href":"https:\/\/advokatskafirmasajic.com\/blog\/wp-json\/wp\/v2\/posts\/518"}],"collection":[{"href":"https:\/\/advokatskafirmasajic.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/advokatskafirmasajic.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/advokatskafirmasajic.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/advokatskafirmasajic.com\/blog\/wp-json\/wp\/v2\/comments?post=518"}],"version-history":[{"count":2,"href":"https:\/\/advokatskafirmasajic.com\/blog\/wp-json\/wp\/v2\/posts\/518\/revisions"}],"predecessor-version":[{"id":520,"href":"https:\/\/advokatskafirmasajic.com\/blog\/wp-json\/wp\/v2\/posts\/518\/revisions\/520"}],"wp:attachment":[{"href":"https:\/\/advokatskafirmasajic.com\/blog\/wp-json\/wp\/v2\/media?parent=518"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/advokatskafirmasajic.com\/blog\/wp-json\/wp\/v2\/categories?post=518"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/advokatskafirmasajic.com\/blog\/wp-json\/wp\/v2\/tags?post=518"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}