North Carolina Banking Institute


Emily S. May


This Note examines the most recent wave of personal liability for bank directors regarding decisions made in their official capacity, as well as the implications that this trend may have on bank directors and shareholders. Part II discusses FDIC claims against bank directors, including the FDIC claim process, the applicable law, and the standard of care in director liability cases. Part III details the trend prior to the 2008 financial crisis in bank director personal liability in enforcement actions. Part IV examines the post-2008 financial crisis trend in bank director personal liability in enforcement actions and details the characteristics of many post-crisis claims. Part V discusses methods that banks use to protect their directors from personal liability, including indemnification agreements and director and officer liability insurance policies ("D&O insurance"). Part VI addresses the potential effects of holding directors personally liable, both from the directors’ and shareholders’ perspectives. Finally, Part VII concludes by considering the overall impact of director personal liability and discussing a potential alternative to holding directors personally liable.

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