§304 Class a and Class B Directors; Selection

Summary

Sets the rules for choosing Class A and Class B directors of each Federal Reserve Bank. The Board of Governors splits the member banks in the district into three groups by size. Each member bank may nominate one person for a Class A seat and one person for a Class B seat. The local Federal Reserve Bank chairman makes a list showing who nominated each candidate and sends that list to every member bank within 15 days. Each member bank must authorize an officer (for example, its president or cashier) to vote. If several member banks in the same district are subsidiaries of the same bank holding company (under the Bank Holding Company Act of 1956), only one of those banks can take part, chosen by the holding company. Within 15 days of getting the candidate list, the authorized officer fills out a preferential ballot (first, second, and other choices) on a form the chairman provides and certifies it. Class A candidates must be nominated and voted on by banks in the same group as the candidate’s bank. If a person is an officer or director of more than one member bank, only banks in the group of the bank with the largest assets may nominate them for Class A. A candidate with a majority of first-choice votes wins. If no one has a majority, add second-choice votes to the first-choice totals, and if needed add third-choice votes; the candidate with the needed majority or the highest combined total wins. The result is reported right away.