1. (a) The trust department of a state bank is theoretically subject to the dominion of the board of directors, and the trust department conceivably might in some situations be called upon to vote the bank's own shares for proposals more calculated to benefit the individual directors than the bank.

2. (b) Under the National Banking Act (12 U.S.C. § 61) a national bank cannot vote its own shares in the election of directors of the bank unless:

   1. (1) Under the terms of the trust the manner in which the shares shall be voted may be determined by a donor or beneficiary of the trust; and
   2. (2) Such donor or beneficiary actually directs how such shares shall be voted.
3. (c) Moreover, if the national bank has a cotrustee, the shares may be voted by the cotrustee.
4. (d) The above stated national bank rule shall be applicable with respect to voting any shares of the bank held by the trust department in the election of the bank's directors.
5. (e) On all other proposals, the trust department is urged to weigh carefully the issues presented and any conflicts of interest that are present before deciding whether to vote or how to vote the shares.

Codification Notes: This section was promulgated as Section 47-701.7 of the State Bank Department Rules prior to codification into the Code of Arkansas Rules. This section as promulgated prior to codification into the Code of Arkansas Rules provided as follows: "(Reference A.C.A. § 23-47-701)"