A Director's Qualifications

Regarding the directors, Section 19 of the Bank Act says: "The stock, property, affairs and concerns of "the bank shall be managed by a board of directors." It has already been shown how, in practice, the board entrusts the active management to the professional general manager. Before taking up the matter of the relations between the board and its manager it will be well to describe again a little more particularly the qualifications required in the directors and the method of their election. The qualifications are: "Each director " shall hold stock of the bank, of which stock he shall " be the absolute and sole owner in his individual right " and not as trustee or in the right of another, as follows:-

Director must hold When the paid-up stock on which capital is is paid up

$1,000,000 or less...................................

$3,000 00

Over $1,000,000, not over $3,000,000

4,000 00

Over $3,000,000.............................................

5,000 00"

Also, it is required of the whole board that "a majority " of the directors shall be natural born or naturalized " subjects of His Majesty and domiciled in Canada." The object of the stock qualification is to ensure that each director has an interest in the bank he shares in managing.

The Election

The directors are the representatives of the whole body of shareholders. They are to be elected by the shareholders at the annual general meeting at the place where the chief office of the bank is situate. Section 21, Subsection 3, says: "Public notice of the annual general " meeting shall be given by the directors by publishing " such notice, for at least four weeks previously to the " time of holding the said meeting, in a newspaper " published at the place where the chief office of the " bank is situate, and by mailing a copy of such notice " to each shareholder at his last known post-office " address, as shown by the books of the bank, at least " twenty days prior to the time aforesaid."

When the number of directors has been fixed - by the charter or by by - law - the candidates getting the greatest number of votes shall be directors. Each share carries one vote, but "no general manager, manager, " clerk or other subordinate officer of the bank shall vote " either in person or by proxy, or hold a proxy for the " purpose of voting."

A shareholder who is unable or unwilling to be present at an election can delegate his voting privilege to another shareholder. He is said then to have appointed a proxy. Once the directors are elected they may hold office till the time of the next annual general meeting of the bank, unless a movement to depose them is successfully carried out by a party of the stockholders.