§ 524.605

524.605 Liability of directors in certain cases. 1. In addition to any other liabilities imposed by law upon directors of a state bank:a. Directors of a state bank who vote for or assent to the declaration of any dividend or other distribution of the assets of a state bank to its shareholders in willful or negligentviolation of the provisions of this chapter, of any restrictions contained in the articles ofincorporation, or of any order by the superintendent restricting the payment of dividendsor other distribution of assets, shall be jointly and severally liable to the state bank for theamount of such dividend which is paid or the value of such assets which are distributedin excess of the amount of such dividend or distribution which could have been paid ordistributed without a violation of the provisions of this chapter, of the restrictions in thearticles of incorporation, or of any order by the superintendent restricting the payment ofdividends or other distribution of assets. b. The directors of a state bank who vote for or assent to any distribution of assets of a state bank to its shareholders during the dissolution of the state bank without the payment anddischarge of, or

The directors of a state bank who vote for or assent to any distribution of assets of a state bank to its shareholders during the dissolution of the state bank without the payment anddischarge of, or making adequate provision for, all known debts, obligations, and liabilitiesof the state bank shall be jointly and severally liable to the state bank for the value of suchassets which are distributed, to the extent that such debts, obligations, and liabilities of thestate bank are not thereafter paid and discharged. c. The directors of a state bank who, willfully or negligently, vote for or assent to loans or extensions of credit in violation of the provisions of this chapter, shall be jointly and severallyliable to the state bank for the total amount of any loss sustained. d. The directors of a state bank who, willfully or negligently, vote for or assent to any investment of funds of the state bank in violation of the provisions of this chapter shall bejointly and severally liable to the state bank for the amount of any loss sustained on suchinvestment. 2. A director of a state bank who is present at a meeting of its board of directors at which action on any matter is taken shall be

state bank for the amount of any loss sustained on suchinvestment. 2. A director of a state bank who is present at a meeting of its board of directors at which action on any matter is taken shall be presumed to have assented to the action taken unlessthe director’s dissent shall be entered in the minutes of the meeting or unless the director shallfile the director’s written dissent to such action with the individual acting as the secretary ofthe meeting before the adjournment thereof or shall forward such dissent by registered orcertified mail to the cashier of the state bank promptly after the adjournment of the meeting.Such right to dissent shall not apply to a director who voted in favor of such action. 3. A director shall not be liable under subsection 1, paragraph 'a', 'b', 'c', or 'd' if the director relied and acted in good faith upon information represented to the director to becorrect by an officer or officers of such state bank or stated in a written report by a certifiedpublic accountant or firm of such accountants. No director shall be deemed to be negligentwithin the meaning of this section if the director in good faith exercised that diligence, care,and skill which

blic accountant or firm of such accountants. No director shall be deemed to be negligentwithin the meaning of this section if the director in good faith exercised that diligence, care,and skill which an ordinarily prudent person would exercise as a director under similarcircumstances. 4. Any director against whom a claim shall be asserted under or pursuant to this section for the payment of a dividend or other distribution of assets of a state bank and who shallbe held liable thereon, shall be entitled to contribution from the shareholders who acceptedor received any such dividend or assets, knowing such dividend or distribution to have beenmade in violation of the provisions of this chapter, in proportion to the amounts receivedby them respectively. Further, any director against whom a claim shall be asserted pursuantto this section for the payment of any liability imposed by this section shall be entitled tocontribution from any director found to be similarly liable. 5. Whenever the superintendent deems it necessary the superintendent may require, after affording an opportunity for a hearing upon adequate notice, that a director or directorswhom the superintendent reasonably

the superintendent deems it necessary the superintendent may require, after affording an opportunity for a hearing upon adequate notice, that a director or directorswhom the superintendent reasonably believes to be liable to a state bank pursuant tosubsection 1, paragraph 'a', 'b', 'c', or 'd', to place in an escrow account in an insured banklocated in this state, as directed by the superintendent, an amount sufficient to dischargeany liability which may accrue pursuant to subsection 1, paragraph 'a', 'b', 'c', or 'd'. Theamount so deposited shall be paid over to the state bank by the superintendent upon finaldetermination of the amount of such liability. Any portion of the escrow account which is Sat Dec 23 01:15:03 2023 Iowa Code 2024, Section 524.605 (31, 0) §524.605, BANKS 2 not necessary to meet such liability shall be repaid on a pro rata basis to the directors whocontributed to the fund. 6. Any action seeking to impose liability under this section, other than liability for contribution, shall be commenced only within five years of the action complained of and notthereafter. [C71, 73, 75, 77, 79, 81, §524.605]95 Acts, ch 148, §63; 2012 Acts, ch 1023, §134; 2022 Acts, ch

contribution, shall be commenced only within five years of the action complained of and notthereafter. [C71, 73, 75, 77, 79, 81, §524.605]95 Acts, ch 148, §63; 2012 Acts, ch 1023, §134; 2022 Acts, ch 1062, §60Referred to in §524.302, 524.702 Sat Dec 23 01:15:03 2023 Iowa Code 2024, Section 524.605 (31, 0)