position you to be successful and avoid some of the pitfalls you can run into by growing quickly,” she says. “What’s more, a general counsel role doesn’t have to be narrowly tailored,” Saltzman says. A bank, for instance, might be able to organize compliance and other administrative operations under the supervision of a chief legal officer. General counsel can be involved in business planning, corporate governance, product planning and other areas that reduce legal risk — before it manifests itself in a customer complaint or regulatory action. “In-house counsel needs to be looked at as people who prevent fires,” Saltzman says, “not just people who put out fires.” FINDING YOUR BANK’S BEST LEGAL TEAM No one size fits all when it comes to how community banks organize their legal departments. For example, Michelle Terry, General Counsel and Senior Vice President at $1 billion asset First Arkansas Bank & Trust in Jacksonville, Ark., reports directly to the CEO, who is also one of the bank’s majority shareholders. By contrast, at American National Bank of Texas in Terrell, Texas, the General Counsel reports to the bank’s chief operating officer and offers advice to the board, even though he doesn’t hold a board seat, says Robert Messer, Chief Financial Officer and Chief Risk Officer. Meanwhile, Aaron M. Kaslow, Executive Vice President, General Counsel and Secretary, is a member of the executive team at Sandy Spring Bank in Olney, MD. “I think it’s a really good idea because you want your general counsel to be aware of what’s happening across the bank so the general counsel can be proactive and not just reactive to issues that come up,” he says. Bankers and attorneys say things generally work best when the general counsel has unfettered access to the C-suite and is actively involved in multiple matters across the banking organization. “It’s not just a lawyer sitting in-house. That’s probably the biggest mistake banks make,” says Paul Saltzman, Chief Legal Officer at EagleBank in Bethesda, MD, who serves on the executive committee and several management committees. “An outside counsel may tell you whether you can do it; an inside lawyer will tell you whether you should do it.” This article was originally published in the May 2023 issue of Independent Bankers magazine. Visit www.independentbanker.org to read more. Reliable expertise. We have extensive experience and technical expertise in the financial institutions industry. Our professionals are prepared to help you address any challenge and leverage every opportunity. Ryan Abdoo, partner ryan.abdoo@plantemoran.com Scott Petree, partner scott.petree@plantemoran.com plantemoran.com 28 | INDEPENDENT REPORT
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