The stockholders of a bank choose a board of directors who formulate the policies of the institution. They are elected for a term of one year by the shareholders at their annual meeting, which is usually held in January. The statutory qualifications of a director are the following: (a) citizenship, (b) residence, (c) holdings of bank stock. Every director must be a citizen of the United States, and during his tenure of office a resident of the state or territory where the bank is located. Three-fourths of the board of directors shall have resided in the state or territory at least one year before their election. By an amendment passed in 1921 this residence qualification was broadened to include also the area within fifty miles of the site of the bank regardless of state border lines. Thirdly, every director must hold not less than five shares, if the bank has a capital of less than $25,000, and if in excess of this amount, he must possess at least ten shares of the capital stock. This is merely a nominal qualification, for a director frequently represents interests which control a large block of the bank's stock.