§ 7015 — Duty of directors and officers; oath of directors

New York § 7015

• Jurisdiction: New York
• Law BNK: Banking
• Title 7: Directors and Officers
• Art. 15: General Provisions Applicable to Banking Stock Corporations, Limited Liability Investment Companies, and Limited Liability Trust Companies

Text

§ 7015. Duty of directors and officers; oath of directors. 1.\nDirectors and officers shall discharge the duties of their respective\npositions in good faith and with that degree of diligence, care and\nskill which ordinarily prudent men would exercise under similar\ncircumstances in like positions. In discharging their duties, directors\nand officers, when acting in good faith, may rely upon (a) financial\nstatements of the corporation represented to them to be correct by the\npresident or the officer of the corporation having charge of its books\nof account, or stated in a written report by an independent public or\ncertified public accountant or firm of such accountants fairly to\nreflect the financial condition of such corporation, and (b) reports\nrequired to be submitted to them by any provision of this chapter or\nprepared in the ordinary course of business by an officer or committee\ncharged with the responsibility therefor. Nothing in this section shall\nbe deemed to require the directors to perform functions vested in any\ncommittee, officer or other person pursuant to the provisions of any\nother section of this chapter.\n 2. In taking action, including, without limitation, action which may\ninvolve or relate to a change or potential change in the control of the\nbanking institution, a director shall be entitled to consider, without\nlimitation, (1) both the long-term and the short-term interests of the\ncorporation and its shareholders and (2) the effects that the\ncorporation's actions may have in the short-term or in the long-term\nupon any of the following:\n (i) the prospects for potential growth, development, productivity and\nprofitability of the corporation;\n (ii) the corporation's current employees;\n (iii) the corporation's retired employees and other beneficiaries\nreceiving or entitled to receive retirement, welfare or similar benefits\nfrom or pursuant to any plan sponsored, or agreement entered into, by\nthe corporation;\n (iv) the corporation's customers and creditors; and\n (v) the ability of the corporation to provide, as a going concern,\ngoods, services, employment opportunities and employment benefits and\notherwise to contribute to the communities in which it does business.\n Nothing in this subdivision shall create any duties owed by any\ndirector to any person or entity to consider or afford any particular\nweight to any of the foregoing or abrogate any duty of the directors,\neither statutory or recognized by common law or court decisions. For\npurposes of this subdivision, "control" shall mean the possession,\ndirectly or indirectly, of the power to direct or cause the direction of\nthe management and policies of a banking institution whether through the\nownership of voting stock of such banking institution, the ownership of\nvoting stock of any company which possesses such power or otherwise.\n 3. Each director of a bank or trust company, stock-form savings bank,\nor stock-form savings and loan association, when appointed or elected,\nshall take an oath that he will, so far as the duty devolves on him,\ndiligently and honestly administer the affairs of such corporation, and\nwill not knowingly violate, or willingly permit to be violated, any of\nthe provisions of law applicable to such corporation. Such oath shall be\nsubscribed by the director making it, and certified by an officer\nauthorized by law to administer oaths, and immediately transmitted to\nthe superintendent.\n 4. Each director of a safe deposit company, when appointed or elected,\nshall take an oath that he will, so far as the duty devolves on him,\ndiligently and honestly administer the affairs of such corporation, and\nwill not knowingly violate, or willingly permit to be violated, any of\nthe provisions of law applicable thereto. Such oath shall be subscribed\nby the director making it, and certified by an officer authorized by law\nto administer oaths, and immediately transmitted to the superintendent.\n