SRC Insights: Fourth Quarter 2004

Introducing: Training for Community Bank Directors

In September, the Federal Reserve System announced the availability of an online training course for bank directors, Insights for Bank Directors: A Basic Course on Evaluating Financial Performance and Portfolio Risk (“Insights”). This course is based on an existing facilitator-led course that was developed by staff at the Federal Reserve Bank of Kansas City and used extensively in their District. System staff developed this online course to provide an alternate mechanism for delivery of the existing program when the facilitator-led session is not practical. Insights can be accessed at www.stlouisfed.org/col/director/agenda.htm External Link .

Insights is an introductory course designed primarily for new outside directors of community banks who have little banking experience. However, directors at larger institutions and more seasoned directors also may find the course useful as a refresher in carrying out their responsibilities.

The course focuses primarily on gauging a bank’s risk-taking and the effectiveness of its risk management. Within this context, the course provides an introduction to corporate governance and director duties and responsibilities, covers basic bank financial analysis, and discusses portfolio risk (credit, liquidity, and market risk) management. It includes exercises and examples to reinforce points made in the study text. Additionally, it provides tools and links to internet sites that directors might find useful in their board oversight, making it a good reference tool.

The course takes approximately eight hours to complete. Directors may go through the course in its entirety or select individual modules most useful to them. For those that elect to review the course in its entirety, the content is subdivided into sections that take between 15 to 30 minutes to complete, allowing directors to complete the course at their own pace rather than in one continuous session.

The course includes both text and video footage. If directors choose to view the video footage, they will need a high-speed connection to the internet and Macromedia Flash player version 6.0. If their internet connection is not high-speed and they are using a dial-up connection through the telephone, they can read the video transcripts and will still be able to view all pages in the course.

To ensure that directors in the Third District have immediate access to this information, we have created a page as part of SRC’s public website that announces the availability of this program. Users can link to that page directly from SRC’s home page.

The views expressed in this article are those of the author and are not necessarily those of this Reserve Bank or the Federal Reserve System.

SRC Insights: Fourth Quarter 2004

Introducing: Training for Community Bank Directors

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