Audit, Dept. of

Banking Division

Chapter 7: Indemnification of Directors & Officers of State Chartered Fin. Insti

Effective Date: 01/31/1986 to 10/01/1996

Rule Type: Superceded Rules & Regulations

Reference Number: 021.0002.7.01311986

Date Filed 01/31/86

Expr Date

Supr Date

Repeal Date

Document Type RULES

CHAPTER VII

INDEMNIFICATION OF DIRECTORS AND OFFICERS OF STATE-CHARTERED FINANCIAL INSTITUTIONS

Section 1. Authority. The State Banking Commissioner, pursuant to authority delegated to him by Section 13-3-704, Wyoming Statutes 1977, prescribes the rules for carrying out provisions of Title 13, Wyoming Statutes, 1977.

Section 2. Indemnification. A state-chartered financial institution may provide in its articles of incorporation for the indemnification of directors, officers, and employees for expenses reasonably incurred in action to which the directors, officers or employees are parties or potential parties by reason of the performance of their official duties. Indemnification articles which substantially reflect general standards of law as evidenced by 17-16-856, Wyoming Statutes, 1977 are considered to be within the corporate powers of a state-chartered financial institution.

Such indemnification provision shall not allow the indemnification of directors, officers or employees of said institution against expenses, penalties, or other payments incurred in an administrative proceeding or action instituted by an appropriate bank regulatory agency which proceeding or action results in a final order assessing civil money penalties or requiring affirmative action by an individual or individuals in the form of payments to the financial institution.

Section 3. Review by State Banking Commissioner. A statechartered financial institution may provide in its articles of incorporation for the payment of premiums for insurance covering the liability of its directors, officers or employees to the extent that such coverage is provided for in 17-16-856, Wyoming Statutes 1977. In accordance with its supervisory responsibilities, the Office of the State Banking Commissioner shall, prior to authorizing the filing of any amendment to the articles of incorporation in the Office of the Secretary of State, review the threat to bank safety and soundness posed by any indemnification or proposed indemnification of directors, officers or employees by a state-chartered financial institution, or for the consistency of any such indemnification with any other provision adopted by that financial institution in its articles of incorporation.

Section 4. Consistency of Rule. The above rule and regulation is consistent with the powers granted to federally chartered financial institutions by the Office of the Comptroller of the Currency and the Office of Thrift Supervision.