Answer from Patricia:You did not state why the other financial intuition was requiring completion of a questionnaire. If the director is looking to become a member of that board, this seems like not only a reasonable query, but also one that the federal regulators would want to see as part of a due diligence process.
Whether or not the financial institution is located within the same MSA is a moot point in relation to Reg. O. Regulation O does not require disclosure of the director's role at an unrelated financial institution.
Answer from Andy:The question may be asked because of Reg O restrictions with correspondent banks. The old Section 215.20 requirements of Reg O are gone, but Section 215.1(b)(4) still says Extensions of credit made to an executive officer, director, or principal shareholder of a bank (or to a related interest of such person) by a correspondent bank also are subject to restrictions set forth in 12 U.S.C. 1972(2).
First published on BankersOnline.com 8/02/10