Regulatory Alerts1994-01-01
Memo 1994-25 Charged-Off Debt of Insiders
General Counsel William D. Grant Jr. issued this memo to clarify that bank directors or officers must forfeit their positions under K.S.A. 9-1114 and 9-1115 even if the bank voluntarily forgives their charged-off debt. The analysis asserts that allowing debt forgiveness to bypass resignation requirements would directly conflict with the statutes' objectives of preserving management integrity and preventing voluntary non-collection of insider loans. Consequently, the voluntary elimination of a judgment or debt by the institution is not grounds for avoiding the mandatory resignation provisions.
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