Mutual Banks Act, 1993 (Act No. 124 of 1993)Chapter IV : Administration of Mutual Banks37. Directors of mutual bank |
| (1) | The business of a mutual bank shall be managed by a board of directors that may, subject to such conditions as the board may determine, delegate any of its powers to any person. |
| (2) | Each director of a mutual bank shall stand in a fiduciary relationship to the mutual bank of which he is a director. |
| (3) | Without derogating from the generality of the expression "fiduciary relationship" in subsection (2), the provisions of that subsection imply that a director — |
| (a) | shall, in relation to the mutual bank of which he is a director, act honestly and in good faith and, in particular, shall exercise such powers as he may have to manage or represent the mutual bank, exclusively in the best interests and for the benefit of the mutual bank, its members and its depositors; and |
| (b) | shall, in the performance of his functions as a director of such a mutual bank, observe such guidelines and comply with such requirements as may be prescribed under section 91(1)(b). |
| (4) | A director shall be elected for a period not exceeding three years but shall be eligible for re-election upon the termination of any period for which he has been elected. |
| (5) | Whenever a casual vacancy occurs on the board of a mutual bank, the remaining directors may appoint a person to fill the vacancy until the next annual general meeting, and the person elected at that meeting shall fill the vacancy for the unexpired period of office of the vacating director. |
| (6) | Save as provided in subsection (5), vacancies on the board of a mutual bank shall be filled at the annual general meeting by election by a majority of the members voting in accordance with the articles. |
| (7) | A mutual bank shall within 14 days of the appointment under subsection (5) or the election under subsection (6) of a director, send to the Registrar a notice of the appointment or election signed by the director appointed or elected and by the secretary of the mutual bank. |
| (8) | A mutual bank shall with the notice referred to in subsection (7) directors and the date upon which the period of office of such director is normally due to expire. |
| (9) | If the remaining directors fail to fill a casual vacancy in accordance with subsection (5) or the members of the mutual bank assembled in annual general meeting fail to fill any vacancy in accordance with subsection (6), the Registrar may in his discretion, and upon the submission to him of a sworn statement in writing made by any seven members and the secretary of the mutual bank or by two directors and the secretary of the mutual bank, setting forth the fact that such a failure has occurred, appoint a duly qualified member of the mutual bank to fill the vacancy until the next annual general meeting. |
| (10) | The board of directors shall cause minutes of all its meetings to be kept, and such minutes shall be confirmed and signed by the chairman at the next ensuing ordinary meeting of the board. |
| (11) | For the purposes of election to the board of a mutual bank, a person appointed by the remaining directors in terms of subsection (5) shall not be regarded as a retiring director. |
| (12) | Notwithstanding anything to the contrary in any law or the common law or in any agreement contained, not more than 49 per cent, rounded off to the next lower integral number, of the directors of a mutual bank shall be employees of that mutual bank or of any of its associates: Provided that in respect of any matter put to the vote at a meeting of the board of directors of a mutual bank such directors who are employees of that mutual bank or of any of its associates shall together not have a vote in excess of 49 per cent of the total vote cast by all the directors present and voting at that meeting. |
| (13) | Notwithstanding the provisions of subsections (4) and (5), a director of a mutual bank who is an executive officer of that mutual bank shall vacate his office as such a director when he ceases to be such an officer. |