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In exercising their responsibilities at AJS
Bancorp. Inc. (the “Company”) and at its wholly owned subsidiary A.J.
Smith Federal Savings Company, directors and officers shall adhere to
the highest standards of honesty, integrity and impartiality. They shall
diligently and honestly administer the affairs of the Company in a
reasonable manner that both complies with the law and reflects proper
business prudence. Directors and officers must act in a loyal manner
consistent with the interests of the Company and put aside their own
personal or business interests. The conduct of Company directors and
officers must be such so as to avoid even the appearance of a conflict
of interest. In the event an appearance of or actual conflict of
interest with the Company unavoidably arises, officers and directors are
expected to disclose it in full and recuse themselves from any decision
making processes in which the conflict arises and take such other
affirmative steps as may be appropriate. In order to assist the
directors and officers in meeting these standards, the following
Standards of Conduct and Code of Ethics (“Code”) are being adopted. This
code is to be closely adhered to by each director and officer in
connection with all matters involving the Company.
CONFLICTS OF INTEREST
For purposes of the Code, a “conflict of interest” shall be deemed to
exist where any director or officer or a related interest has any
personal or financial interest, direct or indirect, in any Company
action, failure to act, decision not to act or method of action, in
connection with any transaction relating to the Company’s internal or
external operations. For these purposes, “related interest” shall be any
entity listed on or which should be listed on the Related Interest
Statement requested annually as a part of Regulation “O” compliance.
Examples of conflicts of interest that would affect directors and
officers and the Company’s internal or external operations or conduct
may include, but are not limited to:
a. loans which will directly or indirectly benefit directors or officers
or members of their immediate family or their related interests;
b. loans to competitors of directors or officers or their related
interests;
c. the restructuring, modification, or renewal of loans were such
restructuring, modification or renewal will directly or indirectly
benefit directors or officers or their related interests;
d. the determination of the Company to enter or not enter into a
contract or other business arrangement for the delivery of goods or the
performance of services with a director or officer or their related
interests and;
e. the availability of a business opportunity for the Company, where a
director or officer, or their related interest might compete for or
otherwise seek this same opportunity.
Loans made to directors and officers in accordance with Company
policy and consistent with applicable regulatory requirements will not
in and of itself result in a conflict of interest.
Appearance of Conflict of Interest. The term “conflict of
interest” shall also include an appearance of a conflict of interest. An
appearance of a conflict of interest shall arise where the facts and
circumstances do not give rise to a full conflict of interest, but are
so similar in nature that they may create doubt as to the impartiality
or loyalty of a director or officer in connection with the transaction
where the appearance arises. Examples of appearances of a conflict of
interest include, but are not limited to:
a. a loan by the Company to the brother-in-law of a director may not
provide a direct or indirect benefit to that director or his/her
immediate family, and therefore an actual conflict of interest does not
exist. However, the existence of the relationship itself gives rise to
the appearance of such conflict and thus would require the director or
officer to recuse him/herself from any decision-making process relating
to the transaction.
b. an officer who assumes responsibility for analyzing and recommending
approval of a loan to director, a major shareholder, or an employee of
another financial institution with which the officer has a personal loan
or an ongoing financial relationship, may not present a direct conflict
of interest. However, the existence of the relationship itself gives
rise to the appearance of a conflict and thus requires that the officer
recuse him/herself from any decision-making process relating to the loan
and abstain from any further action thereon. Also, the officer should
make full disclosure of the appearance of a conflict prior to the
Company’s approval of such a loan.
RECUSAL AND RECORDATION
Disclosure and Recusal. Whenever a director or officer has a
conflict of interest in connection with an internal or external
operation or other conduct of the Company, the director or officer shall
make a full disclosure of the nature of the conflict of interest, recuse
him/herself from the decision-making process and abstain from any
further action thereon.
Recordation. Whenever a director or officer has declared a
conflict of interest in connection with a transaction, such declaration
and the director’s or officer’s recusal and abstention from the
decision-making process shall be recorded in the minutes of the meeting
of the Board of Directors.
ANNUAL REPORTING REQUIREMENTS
Each director and officer shall be required to file with the Company on
an annual basis, a Related Interest Statement in a form approved by the
Board of Directors. Said statement shall be due no later than January
31st of each year, provided however, that each director and officer
shall file such a statement within thirty (30) days after having been
appointed to their position if they have not filed one previously. In
the event that any officer or director applies to the Company for an
extension of credit, the director or officer shall appropriately amend
or certify in writing that any existing related interests statement is
current. Such amendment or certification shall be maintained in the
appropriate loan file or in the files maintained by the Secretary to the
Board.
CORPORATE OPPORTUNITIES
General Prohibition. Directors and officers and their related
interests must not compete with the Company, profit, or otherwise take
advantage from inside information, or take business opportunities which
are within the line of business conducted by the Company, or within a
line of business that the Company might reasonably be expected to enter
in the future. Notwithstanding the foregoing, this general prohibition
shall not be applicable to business opportunities outside the Company’s
immediate or contiguous market area, or business opportunities not set
forth in the Company’s most recent business plan. In evaluating whether
a business opportunity represents a corporate opportunity of the
Company, a director or officer may rely on the Company’s most current
business plan.
ACTION ON CORPORATE OPPORTUNITIES
Disclosure. In the event that a director or officer is presented
with or otherwise becomes aware of a corporate opportunity which is
within the line of business conducted by the Company, or a line of
business that the Company might be expected to enter in the future, the
director or officer shall fully disclose the opportunity to the Company
and declare his/her interest in the opportunity. Thereafter, the
director or officer shall abstain from discussion and voting on any
approval or disapproval thereof. Where it is unclear whether a business
opportunity would present a corporate opportunity to the Company based
upon a review of the business plan disclosure should be made to the
entire board of directors.
Recordation. A decision of the Board approving or disapproving a
corporate opportunity presented to it by a director or officer shall be
recorded in the minutes if the Board, and shall reflect the nature of
the opportunity and all members who take action or abstain from taking
action on its consideration.
Further Action. If, after full disclosure, the Company elects not
to take a corporate opportunity presented to it, to the extent it does
not otherwise present a conflict of interest with his/her position, or
the Board does not rule otherwise, the director or officer who presented
the matter to the Board is free to pursue the opportunity.
Constructive Trust. In the event a director or officer usurps a
corporate opportunity without making full disclosure to the Company and
permitting the Company to decline the opportunity, the profits or
proceeds arising from such opportunity shall be subject to a
constructive trust of which the Company shall be the beneficiary.
Thereafter, upon demand by the Company, the proceeds or profits, if any,
shall be distributed to the Company.
INSIDER TRANSACTIONS
Disclosure. Officers and directors shall disclose all conflicts
of interest they may have with regard to any contract or other business
arrangement to be entered into by the Company. Contracts or other
business arrangements between the Company and its directors and
officers, or between the Company and related interests of the directors
and officers, or between the Company and other entities where a director
or officer may have a personal or financial interest, shall be approved
by the Board only after full disclosure of the conflict of interest by
the interested director or officer who shall thereafter recuse
him/herself from the decision making process and abstain from voting on
the matter.
Recordation. A decision of the Board approving or disapproving a
contract or other business arrangement with a director or officer or
their related interests or where a director or officer otherwise has
financial interest, shall be recorded in the minutes of the Board which
shall reflect the nature of the contract or other arrangement and all
members who take action or abstain from taking action on its
consideration.
Terms. Any contract or business arrangement entered into by the
Company with an officer or director or related interest shall be on such
terms and conditions, and at such costs as would be reasonable under the
facts and circumstances if entered into with an unrelated third party.
COMPLIANCE WITH LAW
General. All contracts or other business arrangements with any
directors or officers, or their related interests or entities in which
the directors or officers have a personal or financial interest, shall
comply with any applicable statutes, rules, or regulations.
Payment of Fees. In paying any management or other fees to
shareholders, directors, officers, or their related interest or entities
in which the shareholders, directors, officers, or their related
interests have a personal or financial interest, the following criteria
should be taken into consideration.
a. Management fees and other fees paid by the Company shall have a
direct relationship to and be based solely upon the fair market value of
the goods received or services rendered.
b. Fees shall be paid only for goods which meet the legitimate needs of
the Company and which are actually rendered.
c. Fees shall take into consideration the qualifications of the
individual(s) providing services.
d. Reasonable fees may be based upon cost, plus a reasonable profit or
current fair market value of the services rendered and may take
reasonable overhead costs into consideration.
e. No prepayment of fees for services shall be made.
COMPETITIVE BIDS
Bids. When a contract or other business arrangement for the
provision of services or delivery of goods to the Company is considered,
the Company should make every reasonable attempt to obtain competitive
bids for such contract or arrangement. In the event a director or
officer has a personal or business interest in the contract or other
arrangement, he or she shall recuse him/herself from any discussion of
the competitive bid process and shall not have access to any documents
relating to the decision-making process or the bids themselves.
Documentation. All performance of any contract or other business
arrangement shall be documented, and the documents shall be retained by
the Company for a reasonable period of time. Such documentation shall
include, but not be limited to: the bids; evidence of payment; documents
reflecting the actual delivery of goods or performance of services
contracted for; and documents evidencing the review of the performance
of the contract or other business arrangement by the appropriate Company
officer(s) or the Board.
ACCEPTANCE OF GIFTS AND OTHER GRATUITIES
General. Directors and officers of the Company are prohibited
from (a) soliciting for themselves or a third party (other than the
Company) anything of value from anyone in return for any business,
service, or confidential information of the Company; or (b) accepting
anything of value (other than salary, wages, fees or other usual
compensation) from anyone in connection with the business of the
Company, either prior to or after a transaction.
Exceptions. Exceptions to the general prohibition regarding acceptance
of things of value in connection with the Company’s business may include
the acceptance of:
a. gifts, gratuities, amenities or favors based on obvious family or
personal relationships (such as those with the parents, children or
spouse of a Company official) where the circumstances make it clear that
it is those relationships rather than the business of the Company, which
are the motivating factors;
b. meals, refreshments, entertainment, accommodations, or travel
arrangements, all of reasonable value, during the course of a meeting or
other occasion, the purpose of which is to hold bona fide business
discussions or to foster better business relations, provided that the
expense would be paid for by the Company as a reasonable business
expense, if not paid for by another party.
c. loans from other companies or financial institutions on customary
terms to finance proper and usual activities of the directors or
officers, or employees, except where prohibited by law;
d. advertising or promotional material of reasonable value, such as
pens, pencils, note pads, key chains, calendars, and similar items;
e. discounts or rebates on merchandise or services that do not exceed
those available to other customers;
f. Gifts of value (not to exceed $35.00) that are related to commonly
recognized events or occasions, such as a promotion, new job, wedding,
retirement, Christmas or bar mitzvah; or
g. Civic, charitable, educational, religious organizational awards for
recognition service and accomplishment.
Notification and Approval. In the event a director or officer is
offered anything of value from anyone in return for any business,
service, or confidential information of the Company and the item of
value is not clearly subject to the exceptions in Paragraph 2 above, the
director or the officer should report it immediately to the Chairman of
the Board, or his or her supervisor as the case may be. In the case of
an officer, the supervisor shall report it to the Secretary of the Board
who will maintain contemporaneous written reports of such disclosures
and will make all final determinations as to how the matter will be
addressed. In the case of a director, the Chairman of the Board will
make all final determinations as to how the matter will be addressed.
TRADE SECRETS
Each director/officer hereby acknowledges that the term “confidential
information, trade secrets, and property” and all variations of that
term used herein, includes without limitation, current and prospective
client and customer lists, information with respect to client and
customer accounts, requirements and practices, sales methods and ideas,
employee lists and employment data, documents, books, records, data,
materials, supplies, contract forms, and other information relating to
the Company, its employees and its products, services, and operations,
regardless of whether similar to the foregoing, and regardless of
whether conceived by the director, officer or Company.
Unauthorized Use Prohibited. Each director/officer agrees that
he/she shall not, at any time (1) during the term of his/her tenure or
employment or (2) after the termination therefore, disclose, use, or
threaten to use, other than in the performance of their duties for the
Company, any confidential information, trade secrets, or property of the
Company, regardless of whether acquired or conceived by the director or
officer. Director/officer hereby acknowledges that such confidential
information, trade secrets, and property are secret, confidential, and
unique, that they constitute the exclusive property of the Company, that
such confidential information, trade secrets or property will be made
known to director of officer in confidence in connection with their
professional duties, and that any use of such confidential information,
trade secrets or property by him/her, other than for the sole benefit of
the Company would be wrongful and would cause irreparable harm.
Solicitation of Clients. Without limiting the generality of the
preceding two paragraphs, but rather to implement their provisions, each
director/officer agrees that, during the 12 month period commencing with
the date of termination of the director’s/officer’s tenure and/or
employment, he/she will not, without prior express written consent of
the Company in each instance, directly or indirectly, for the
director/officer alone or for any other person or for any organization
in which he/she directly or indirectly has a proprietary interest or by
which he/she is employed or engaged in any capacity, call upon, solicit,
or cause to be solicited any person or organization that was a client of
the Company within the 12 month period ending on the effective date of
his/her termination of association or employment. If the business in
which the director/officer is engaged in any way involves products or
services directly competitive with those sold, supplied, or performed by
the Company at the time of termination of the director’s/officer’s
association with the Company.
Association with Others Possessing Confidential Information.
Director/officer further agrees that, during the 12 month period
commencing with the date of termination of their employment/association
with the Company, they will not, without the prior express written
consent of the Company, directly or indirectly, employ, offer to employ,
be employed with, or otherwise participate in business with any person
who is or had been a director, officer, or employee of, or consultant to
the Company in any capacity at any time within the 12 month period
ending on the date that director’s/officer’s employment or association
with the Company was terminated, if such other person possesses
knowledge of the confidential information of the Company that may be
used in connection with such business or employment.
Return of Confidential Documents. Upon termination of the
director’s/officer’s association or employment with the Company, he/she
agrees to deliver promptly to the Company all books, records, samples,
business plans, manuals, blank forms, documents, letters, notes,
notebooks, reports, data, and all copies of the foregoing, and all other
confidential information, trade secrets, and property of the Company;
including, without limitation, all documents that in whole or in part
contain any trade secrets or confidential information of the Company
that are in his/her possession or under his/her control, and
director/officer shall not retain any such materials or copies thereof
without the prior express written consent of the Company.
NOTIFICATION OF CODE
Board of Directors. Each director, on an annual basis, shall be
provided with a current copy of this Code and shall confirm
acknowledgement of its receipt in writing. At the time of appointing a
newly elected Director, he/she shall be provided with a current copy of
this Code at the first meeting of the Board of Directors he/she attends,
and shall acknowledge the same in writing. All acknowledgements shall be
maintained with the records held by the secretary to the President.
Presentation to Officers. Officers, at the time of appointment,
who are not members of the Board, shall be provided with a copy of this
Code and shall acknowledge receipt of the same in writing. Said
acknowledgement shall be maintained in the personal file of the officer.
NOTE: Whenever this Code is revised, a copy will be provided to
each Director and Officer, who will then acknowledge the same in
writing.
Reporting Violations of the Code
Acting with the highest standards of ethics and integrity is critical to
the success of our Bank, and must be reflected in our daily decisions
and actions. It is the duty and responsibility of each employee to
understand and adhere to the principles provided in the Code so that
potential issues may be effectively and efficiently resolved and the
valuable reputation of the Bank preserved. Any known or suspected
violation of the Code must be promptly reported. This includes
violations or possible violations involving you, another employee,
including managers, or an agent acting on behalf of the Bank. Any
violation of law, rule or regulation applicable to the Bank and/or
corporate policy is also a violation of this Code. Violations of the
Code may result in disciplinary action including, in severe situations,
immediate termination of employment.
If you know or suspect a violation of the Code, including actions or
failures to act, immediately report the matter to your manager. Concerns
or complaints regarding accounting, internal accounting controls or
auditing matters that arise in the ordinary course of business and that
cannot be resolved with your immediate supervisor should be directed to
the Chief Ethics Officer/Chief Compliance Officer, Lyn G. Rupich, in
person, via phone at 708.687.7400 or via email at lrupich@ajsmithbank.com.
All concerns or complaints will be promptly investigated and appropriate
action taken. No person expressing concerns or complaints will be
subject to any disciplinary or other adverse action by the Bank absent a
knowingly false report. All concerns or complaints may be made
anonymously and will remain confidential. Please provide sufficient
information to allow parties to properly investigate your concerns or
complaints. The Bank will retain a record of all concerns and
complaints, and the results of its investigations, for five years.
Code of Ethics
For Chief Executive Officer, President and Senior Financial Officers of
AJS Bancorp, Inc.
It is the policy of AJS Bancorp, Inc. that the Chairman of the Board and
Chief Executive Officer (“CEO”), President and Chief Financial Officer
(“CFO”) of AJS Bancorp, Inc. (hereinafter referred to as the “Company”)
adhere to and advocate the following principles governing their
professional and ethical conduct in the fulfillment of their
responsibilities:
1. Act with honesty and integrity, avoiding actual or apparent conflicts
between his or her personal, private interests and the interests of the
Company, including receiving improper personal benefits as a result of
his or her position
2. Perform responsibilities with a view to causing periodic reports and
other documents filed with the SEC to contain information which is
accurate, complete, fair and understandable.
3. Comply with laws of federal, state, and local governments applicable
to the Company, and the rules and regulations of private and public
regulatory agencies having jurisdiction over the Company.
4. Act in good faith, responsibly, with due care, and diligence, without
misrepresenting or omitting material facts or allowing independent
judgment to be compromised.
5. Respect the confidentiality of information acquired in the course of
the performance of his or her responsibilities except when authorized or
otherwise legally obligated to disclose. Do not use confidential
information acquired in the course of the performance of his or her
responsibilities for personal advantage.
6. Proactively promote ethical behavior among subordinates and peers.
7. Use corporate assets and resources employed or entrusted in a
responsible manner.
8. Do not use corporate information, corporate assets, corporate
opportunities or one’s position with the Company for personal gain. Do
not compete directly or indirectly with the Company.
9. Comply in all respects with the Company’s Standards of Conduct and
Code of Ethics, and this Code of Ethics.
10. Advance the Company’s legitimate interests when the opportunity
arises.
It is also the Policy of AJS Bancorp, Inc. that the Chairman and CEO,
President and CFO of the Company acknowledge and certify to the
foregoing annually and file a copy of such certification with [each of]
the Audit Committee [and the Corporate Governance Committee of the
Board.]
The Corporate Governance Committee shall have the power to monitor, make
determinations, and recommend action to the Board with respect to
violations of this Policy, except for paragraph 2, 3 and 4 with respect
to which the Audit Committee shall have such power.
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