Each depositor insured to at least $250,000 per insured bank

SARC- 95-03 (August 25, 1995)

The Supervision Appeals Review Committee of the Federal Deposit Insurance Corporation (“FDIC”), on August 24, 1995, considered your appeal of a material supervisory determination and concluded that the bonus payments of $35, 000 each made to the bank’s seven non-officer directors during 1993 and 1994 should be reported as dividends on the Consolidated Reports of Condition and Income filed with the FDIC.  Amended reports should be filed as appropriate.  Analysis of the bonus payments indicates that despite the form of the payments, the substance of the transactions is the payment of dividends, and they should be reflected as such for regulatory reporting purposes.

This determination is considered a final supervisory decision of the Federal Deposit Insurance Corporation.