1. The Corporate StructureAruba Bank N.V. (the Company) is a company established under the laws of Aruba. The Articles of Association form the basis from which the Corporate Governance Structure is derived. It is based on a two-tier structure consisting of a Management Board and a Supervisory Board.
2. Management BoardMembers of the Management Board are appointed by the General Meeting of Shareholders. The bank’s by-laws dictate that a minimum of two Managing Directors is required. The Management Board is responsible for the setting and achieving of the Company’s objectives, strategy and policies, as well as for the delivery of results, for managing the risks associated with the business activities of the bank and for the bank’s financing. The Management Board ensures that the Company is compliant with all relevant laws, regulations. In performing its duties, the Management Board acts in accordance with the interests of the bank and the business connected with it, taking into consideration the interests of all the stakeholders of the bank. The Management Board reports on the development of its responsibilities and discusses the internal risk-management and control systems with the Supervisory Board. The Management Board performs its activities under the supervision of the Supervisory Board and is accountable for the performance of its duties to the Supervisory Board and the General Meeting of Shareholders.
At least once a month the Management Board meets at the bank's offices. Each Managing Director informs the other Managing Directors in a clear and timely manner about the major developments in the area of his or her responsibilities. Resolutions are adopted by absolute majority of votes, unless a qualified majority is required by law, directives and/or policies. The Management Board is assisted by the Manager Corporate Affairs, who is appointed by the Management Board in consultation with the Supervisory Board. The adopted resolutions, discussions held and/or other actions taken are recorded in the minutes of the Management Board meetings.
The Management Board members are collectively responsible for all Management Board decisions.
3. Supervisory BoardThe duties of the Supervisory Board include ensuring that the appropriate plans and policies of Aruba Bank N.V. are in place, taking all interests of the Bank and its stakeholders into consideration. The corporate strategy, risk and the internal control framework are discussed and assessed by the Supervisory Board in their meetings, which take place at least five times a year. Resolutions of the Board are adopted if the majority of the votes is cast in favor of the proposed resolution.
The Bank’s by-laws indicate that the Supervisory Board should consist of at least five members who are appointed by the General Shareholders meeting. A Supervisory Board member profile was adopted by the Board after assuring the alignment of the profile with the needs of an institution such as Aruba Bank. Amendments to the profile can only be made after consultation and agreement by the majority of the Supervisory Board. Each Board member is appointed for a term of maximum three years and may be reappointed. The Board conducts an annual review of its performance. The result of this evaluation is used to determine recommendations and/or action plans for the Board if so desired.
Any outside positions a Supervisory Board member intends to execute that may be of importance to Aruba Bank N.V., needs to be presented to the Chairman of the Supervisory Board for assessment before accepting the position. A Supervisory Board member shall not utilize in any way whatsoever, information of confidential nature for his personal benefit and/ or disclose this information to outsiders. Newly appointed Supervisory Board members need to follow an introduction program prior to assuming their new responsibility. Aruba Bank requires that at least half of the number of the Supervisory Board members is independent.The General Meeting of Shareholders appoints a Chairman and a vice-Chairman from amongst the members of the Supervisory Board. The Chairman of the Supervisory Board is primarily responsible for the functioning of the Supervisory Board and its Committees. He shall act as the spokesman of the Supervisory Board and is the main contact for the Management Board and its individual members. Supervisory Board meetings are presided over by a Chairman or in his absence the vice-Chairman of the Supervisory Board.
4. CommitteesThe Supervisory Board has established several Committees to allow for well founded and responsible decision making. The members, including the Chairmen of each Committee are appointed amongst themselves by the Supervisory Board. Membership of the Committee terminates automatically when the relevant member discontinues his position of Supervisory Board member. Each Committee has its own Charter which describes the composition, responsibilities, meeting and reporting procedures, as well as the powers mandated to the Committee.
After consulting the other Committee members, the Chairman of each Committee establishes the agenda and assures that the tasks of the Committee are duly and timely executed. The respective Chairman is responsible for informing the Supervisory Board in a clear and timely manner of major developments and findings of the respective Committee.
The Supervisory Board has established an Audit and Compliance Committee, as Nomination and Remuneration Committee, a Related Party Transaction Committee, a Supervisory Board Credit Committee and a Board Asset and Liability Committee.
4.a Audit and Compliance CommitteeThe primary task of the Audit & Compliance Committee includes the monitoring of the integrity of the Bank's financials, its compliance with Legal, Regulatory and Banking Supervisory Requirements, Internal Control and Risk Management. At least once a year, the Audit and Compliance Committee meets with the Chief Compliance Officer, as well as the Internal Auditor in absence of Management. Both Officers have an internal administrative reporting relationship within the organization but can report directly to the Audit & Compliance Committee when needed. The ACC prepares the selection of the external auditors for Shareholders approval and is responsible for the reviewing of the independence and performance of the external auditor. The ACC will meet with the external auditor in the absence of management at least once a year.
The Audit & Compliance Committee consists of three members of the Supervisory Board of which two are independent. Each member of the ACC is appointed by the Supervisory Board for a three year period and is required to be financially literate. At least one member has to be a financial expert. The Committee meets five times a year. Members of the Audit and Compliance Committee have unrestricted access to Management, Employees of the bank as well as outside advisors.
4.b Nomination & Remuneration CommitteeThe Committee prepares the recommendations to the Supervisory Board for the primary and secondary terms and conditions of employment of the Managing Directors. After approval by the Supervisory Board, these recommendations will be presented to the General Meeting by the Supervisory Board for adoption. The Committee also advises the Supervisory Board on the nomination of new Managing Directors as well as (re)appointment of new Supervisory Board members, taking into account the Supervisory Board member profile when preparing their recommendation.
The Nomination and Remuneration Committee consists of three members of which two are independent. The Committee meets at least two times a year.
4.c Related Party Transaction CommitteeThe Related Party Transaction Committee evaluates any transaction prior to execution between the Company or a Subsidiary and a Supervisory Board member or a Managing Director or a shareholder, as it relates to the person with relations in the first and second degree.
The Related Party Transaction Committee consists of three independent members, including the Chairman, which have all been appointed by the Supervisory Board.
4.d Supervisory Board Credit CommitteeThe Committee evaluates the credit exposure of the Company and its Subsidiaries as a whole and supervise that the Management Board has established policies and guidelines stipulating the Company’s tolerances with respect to credit risk and the compliance of the Management Board with these policies and guidelines.
The Committee meets at least two times a year. The majority of the Committee needs to be present in order to constitute a valid quorum. The Chairman of the Committee shall report on the outcome of a Committee meeting during the first meeting of the Supervisory Board following that Committee meeting.
Credit exposures of the bank and/or its Subsidiaries in excess of the predetermined threshold amount require the prior approval of the Committee. The Committee reviews large group risk exposures based on the “Large exposure rules” of the Central Bank of Aruba and portfolio diversification (by industry, size and when relevant). The Board Credit Committee consists of three Supervisory Board members who are appointed by the Supervisory Board.