Duties & Responsibilities of a CEO at a Bank
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A bank chief executive officer (CEO) is in charge of all aspects of a bank's operations and procedures. The incumbent in the job is highly educated and has held several different jobs in banking. Her experience is diverse to the point that she has an understanding of how all aspects of operations interact. These diverse experiences allow the CEO to make decisions in the best interest of the board of directors, employees and customers.
Operations and Policy
The CEO of a bank is responsible for operations and policy. These operations include how the bank handles business. These functions are defined and regulated by the Federal Reserve, but things not regulated are determined by bank policy written by the decision makers in the bank management team, which is supervised and directed by the CEO. These policies and procedures govern operations such as lending requirements, mortgage requirements, opening an account, savings account rules, checking account rules, interest paid to customers and profit margins on money under the bank's control. The CEO is answerable to the customers, shareholder and the Federal Reserve Bank for violations of these policies. It is not necessary for the CEO to micromanage the bank operation. The CEO has several additional levels of management. While the CEO is ultimately responsible for the overall success of the operations and policy of the bank, these additional managers will handle a specific aspect of the operations and report directly to the CEO.
Accurate Reporting of Finances and Data
Financial regulations have placed greater emphasis on the accuracy of data and finances reported to the public as part of the bank's financial statements. From 2005 to present there have been several high profile fraud cases surrounding financial statements. To combat this type of fraud, members of the board of directors, the CEO, CFO and managers are now personally liable for inaccuracies in financial statements. The CEO of a bank is responsible for making sure the data that is reported to the shareholders, board of directors and customers is accurate and compliant with Federal Reserve requirements. A CFO who is open and transparent with the financial data of his company will boost confidence in all parties who have an interest in the bank's success.
Plan and Coordinate Day to Day Operations
The CEO of a bank also must delegate responsibilities and follow up in a timely manner to ensure that the core functions of the bank and business are being conducted to meet the needs of the customers. Many banks have several organizations that conduct specific functions of the banking operation. The CEO must monitor all his subordinates to make sure the bank is performing well and all returns on investments are being maximized. The CEO often has additional roles he must fulfill. The CEO might be a member of the board of directors for the bank. She may also be part of audit committees or bank governance committees charged with making sure the bank remains transparent and accountable to the investors. A CEO must also make changes based on economic conditions. Bank CEOs network with colleagues from other banks to share ideas for navigating the changes in regulations or economic conditions.
Stephen J. Barron Jr. is currently the controller for Northampton County, Pa. He enjoys writing about history and Americana, but also has written about fraud, finance, and corporate governance. He publishes a blog and has written content for several online publications. He is a graduate of Widener University where he earned his B.A. in 1999 and J.D. in 2002.