Pursuant to the American Recovery and Reinvestment Act of 2009 (ARRA) enacted February 17, 2009, and 31 C.F.R. Part 30, Interim Final Rule-TARP Standards for Compensation and Corporate Governance, Moscow Bancshares, Inc., holding company for The Bank of Fayette County (“Bank”), hereby adopts this Excessive or Luxury Expenditures Policy (“Policy”). This Policy is intended to ensure appropriate review and approval of potentially excessive and luxury expenditures and all employees of the Bank and its subsidiaries are subject to this Policy and will be held accountable for compliance with the Policy. Any violation of this Policy must be promptly reported to the board of directors (“Board”) and the Board is charged with the responsibility of adherence to this Policy.
Any and all suspected violations of this Policy should be reported to the Compliance/BSA Officer promptly via telephone, email, and/or written correspondence. All suspected violations will be reviewed and researched by the Compliance/BSA Officer and reported to the Board as soon as possible.
Excessive or Luxury Expenditures
The term ‘‘excessive or luxury expenditures’’ means excessive expenditures on any of the following to the extent such expenditures are not reasonable expenditures for staff development, reasonable performance incentives, or other similar reasonable measures conducted in the normal course of the Bank’s business operations:
- Entertainment or events;
- Office and facility renovations;
- Aviation or other transportation services; and
- Other similar items, activities, or events for which the Bank may reasonably anticipate incurring expenses, or reimbursing an employee for incurring expenses.
Entertainment and Events
The Bank utilizes entertainment or events to drive business and revenue growth, build shareholder value and help advance our community. These activities are carefully evaluated to ensure that they are focused on legitimate business purposes and not on extraneous recreational or non-business activities.
Occasional entertainment such as taking customers or prospective customers to dinner, to play golf or to a local sporting event is a normal part of the Bank’s marketing efforts and is not deemed to be a violation of this Policy. These expenses are subject to the normal approval and payment process, and must be documented and detailed as to the date and nature of the event, the person(s) entertained and the business purpose of the event. The Bank may also be a sponsor of charitable activities and events in our market areas.
Entertainment or events that are non-business focused or that are for the benefit of a Bank employee only are prohibited. Any expenditure deemed to be excessive upon receipt of reimbursement request may be rejected and reported to senior management up to and including the CEO and the Board.
Prior approval is required by senior management for out-of-town events and Bank-paid educational activities.
Office and Facility Renovations
Renovations of offices and facilities will be designed to enhance operational efficiency, comply with applicable fire codes and ADA requirements, maintain a safe working environment, enhance the public image of the Bank, or for such other worthwhile purpose as may be identified by the Bank.
Office and facility renovations that are not a necessity or that are not made to enhance customer relations are prohibited.
Prior Board approval is required for all extensive office and facility renovations.
Aviation and Other Transportation Services
All travel paid for by the Bank will be conducted in the most cost-appropriate way.
The Bank will not purchase any aircraft and no private aviation services or private driver will be provided to any employee.
Prior approval is required by senior management for transportation required for out-of-town events and Bank-paid educational activities.
Other Similar Activities
Other activities that are not reasonable expenditures for staff development, for business and revenue growth, to build shareholder value, to sponsor charitable activities and events, to enhance the public image of the Bank, or to help advance our community are prohibited.
The President/CEO, H. McCall Wilson, Jr., and Senior Vice President, Barbara Bradford, will certify that any expenditures related to the Board or senior executive officers have been properly approved.
Policy to Remain in Full Force and Effect
This Policy will remain in full force and effect during the TARP period. If the Board makes any material amendments to this policy, within ninety (90) days of the adoption of the amended policy, the Board will provide the amended policy to Treasury and the Federal Reserve Board.