Bylaws of the Federal Reserve Bank of Minneapolis

Effective as Amended December 15, 2011

Article I—Scope

These bylaws relate to the organization, operation, and activities of the Federal Reserve Bank of Minneapolis. All references herein to the Federal Reserve Bank of Minneapolis or to “the Bank” shall be deemed to be to the Minneapolis office, its Directors, officers and employees. Wherever these bylaws relate to the organization, operation, or activities of the Helena Branch, they specifically reference the Helena Branch or “the Branch.”

Article II—Directors of Bank

Section 1. General Powers and Duties of Directors. The general conduct of the business and affairs of the Bank shall, subject to the supervision vested by law in the Board of Governors of the Federal Reserve System, be under the supervision and control of the Board of Directors of the Bank.

Section 2. Quorum. A majority of the Directors shall constitute a quorum for the transaction of business, but less than a majority may adjourn from time to time until a quorum is in attendance.

Section 3. Supervision and Regulation Matters. The Board of Directors is not involved in institution-specific supervision and regulation matters, nor does it have access to confidential supervisory information. There are some supervision and regulation matters of an administrative nature which will be considered by the Board of Directors, such as (i) the approval of the supervision and regulation annual budget; (ii) review of any Board of Governors’ operations review reports of the function and review and approval of internal audit reports for the function; and (iii) the appointment and compensation of the Bank’s officers (below the rank of President) with responsibility for supervision and regulation. Class A and Class B Directors shall not be involved in the deliberations, nor may they vote on supervision and regulation matters of an administrative nature. For purposes of a quorum for this section 3, two of the three Class C Directors must be present at a meeting at which supervision and regulation matters are considered. Action by the Board of Directors on supervision and regulation matters of an administrative nature shall be upon a vote of a majority of the Class C Directors present at such meeting.

Section 4. Meetings. The chair shall annually establish for the coming year the date, time, and place for regular meetings of the Bank Board. A different time or place for any monthly meeting may be fixed by action at the preceding meeting of the Bank Board or by action of the Executive Committee. The chair of the Board may call a special meeting at any time and shall do so upon the written request of any three Directors or the President. Notice of regular and special meetings may be given by mail or by electronic transmission. If given by mail, such notice shall be mailed at least seven days before the date of the meeting. If given by electronic transmission, such notice shall be dispatched at least four days before the date of the meeting. Notice of any meeting may be dispensed with if each of the Directors shall, in writing, waive such notice.

Section 5. Action Without Meeting. Any action which might be taken at a meeting of the Bank Board may be taken without a meeting if authorized by a writing or writings signed by all of the Directors. Such action shall be effective on the date on which the last signature is placed on such writing or writings or such earlier effective date as is set forth therein. For purposes of this Section an electronic transmission sent by a Director shall be regarded to be a writing signed by such Director.

Section 6. Chair of the Board. The chair of the Board of Directors of the Bank shall preside at meetings of the Bank Board and of the Executive Committee. In the chair’s absence the deputy chair shall act as chair and in the absence of both, the third Class C Director shall preside. In the absence of all Class C Directors the members present shall designate one of their number to act as chair of the meeting.

Section 7. Secretary. The secretary of the Bank shall serve as secretary of any meeting of the Board of Directors of the Bank and of the Executive Committee as requested by the chair of such meeting.

Article III—Board Committees

1. Executive Committee
   1. Section 1. How Constituted. There shall be an Executive Committee consisting of the chair and two or more other members of the Board of Directors of the Bank appointed annually by the chair to serve during the calendar year or until their successors are appointed. Any other member or members of such Board may attend the meetings of the Committee and while so attending shall be members of the Committee for all purposes, including the requirements hereof with respect to a quorum. Two members of the Executive Committee shall constitute a quorum for the transaction of business, and action of the Committee shall be upon vote of a majority of those present at any meeting of the Committee.
   2. Section 2. Powers. Subject to the supervision and control of the Board of Directors of the Bank, the Executive Committee shall have the general power, during intervals between meetings of the Bank Board, to supervise and control the business of the Bank, and the power, subject to review and determination of the Board of Governors of the Federal Reserve System, to fix the discount rate of the Bank.
   3. Section 3. Meetings. The Executive Committee may fix the time and place of holding regular and special meetings and the method of giving notice thereof, such notice to be provided to the Board of Directors of the Bank. However, it shall be the duty of the Executive Committee to meet with sufficient frequency to provide for discharge of the Bank’s statutory obligation to establish the discount rate at least once each fourteen days.
   4. Section 4. Action Without Meeting. Any action which might be taken at a meeting of the Executive Committee may be taken without a meeting if authorized by a writing or writings signed by all of the members of the Executive Committee. Such action shall be effective on the date on which the last signature is placed on such writing or writings or such earlier effective date as is set forth therein. For purposes of this section an electronic transmission sent by a member of the Executive Committee shall be regarded to be a writing signed by such member.
2. Audit Committee
   1. Section 1. How Constituted. There shall be an Audit Committee consisting of three or more members of the Board of Directors of the Bank, appointed annually by the chair to serve during the calendar year or until their successors are appointed. Such members shall meet the qualifications issued by the Board of Governors of the Federal Reserve System. Any other member or members of such Board may attend the meetings of the Committee and while so attending shall be members of the Committee for all purposes, including the requirements hereof with respect to a quorum. Two members of the Audit Committee shall constitute a quorum for the transaction of business, and action of the Committee shall be upon vote of a majority of those present at any meeting of the Committee.
   2. Section 2. Duties. The Audit Committee acts on behalf of the Board of Directors to assess the effectiveness and independence of the internal audit function and reports the results of those assessments to the Board of Directors. This function, directed by a general auditor, includes, but is not limited to, assessment of the adequacy and effectiveness of management’s governance, risk assessment, and control processes for (1) financial reporting; (2) effectiveness and efficiency of operations; (3) compliance with applicable laws, regulations, and procedures; and (4) safeguarding of assets.
   3. Section 3. Audit Independence. To promote independent and objective assessments, the general auditor reports directly to the Board of Directors through the Audit Committee and is not dependent on any Bank executive or operating officer for the security of his or her position. The Audit Committee ensures that the general auditor has access to the Board of Directors, on a confidential basis, and that the audit function is independent of Bank management.
3. Nominating and Governance Committee
   1. Section 1. How Constituted. There shall be a Nominating and Governance Committee consisting of the chair and two or more other members of the Board of Directors of the Bank appointed annually by the chair to serve during the calendar year or until their successors are appointed. Two members of the Nominating and Governance Committee shall constitute a quorum for the transaction of business, and action of the Committee shall be upon vote of a majority of those present at any meeting of the Committee.
   2. Section 2. Powers. The Nominating and Governance Committee considers and makes recommendations concerning the Board of Directors’ membership and provides oversight of corporate governance.
   3. Section 3. Meetings. The Nominating and Governance Committee meets as needed throughout the year, but generally not less frequently than annually. The Bank president and/or first vice president may attend meetings of the Nominating and Governance Committee to provide input on potential Board candidates.
4. Budget, Evaluation, and Risk Committee
   1. Section 1. How Constituted. There shall be a Budget, Evaluation, and Risk Committee consisting of the deputy chair and two or more other members of the Board of Directors of the Bank appointed annually by the chair to serve during the calendar year or until their successors are appointed. Two members of the Budget, Evaluation, and Risk Committee shall constitute a quorum for the transaction of business, and action of the Committee shall be upon vote of a majority of those present at any meeting of the Committee.
   2. Section 2. Powers. The Committee shall provide oversight for the Bank’s budget, evaluation, and risk management activities.
   3. Section 3. Meetings. The Budget, Evaluation, and Risk Committee meets periodically with meetings scheduled prior to submission of the (1) Bank’s budget and (2) self evaluation to the Board of Governors.
5. Other Committees
   The Board shall establish other committees as deemed necessary to conduct its business.

Article IV—Directors of Branch

Section 1. How Constituted. The Board of Directors of the Helena Branch shall consist of five members, three of whom shall be appointed by the Board of Directors of the Bank and two by the Board of Governors of the Federal Reserve System.

Section 2. Quorum. A majority of the members shall constitute a quorum for the transaction of business, but less than a majority may adjourn from time to time until a quorum is in attendance.

Section 3. Meetings. The chair shall annually establish for the coming year the date, time, and place for regular meetings of the Branch Board.

Section 4. Chair of the Board. The Branch Board shall annually elect as its chair one of the members appointed by the Board of Governors of the Federal Reserve System. In the chair’s absence the other appointee of the Board of Governors shall act as chair, and in the absence of both, the members present shall designate one of their number to act as chair of the meeting.

Section 5. Secretary. The Branch Board shall appoint a secretary who shall record the minutes of each meeting and promptly send a copy thereof to each Branch director and to the secretary of the Bank, and perform such other duties as may be pertinent to the secretary’s office.

Article V—Officers and Other Appointees; Compensation

Section 1. Appointments. The Board of Directors of the Bank shall, in accordance with law, appoint a president and first vice president subject to the approval of the Board of Governors of the Federal Reserve System for terms of five years. The president and first vice president shall be appointed and reappointed based upon an affirmative vote of a majority of the Class B and Class C Directors present at a meeting at which a quorum of Directors is present. The Class A Directors shall not participate in the selection process, nor may they vote on such matters.¹ The Board of Directors of the Bank may also appoint such other officers or employees, subject to Article II, section 3, as it may from time to time determine to be appropriate for the conduct of the business of the Bank or of any office thereof, which officers or employees shall serve at the pleasure of the Board.

Section 2. Compensation. Compensation of members of the Bank Board, the Branch Board, committees appointed by the Bank Board, and the member of the Federal Advisory Council appointed by the Bank Board shall be in accordance with the uniform schedule of fees set forth by the Board of Governors of the Federal Reserve System. The Bank Board shall, subject to the approval of the Board of Governors of the Federal Reserve System, fix the compensation of the president. The Bank Board may also fix or approve in accordance with the guidelines issued by the Board of Governors of the Federal Reserve System, the compensation of the first vice president, other officers, and employees.

Section 3. President and First Vice President. The president shall be the chief executive officer of the Bank and, subject to the supervision and control of the Board of Directors of the Bank, shall manage and conduct the business and affairs of the Bank. In discharge of such responsibilities, the president, or such officers as the president may authorize, may employ, define the duties of, dismiss at pleasure, and in accordance with the guidelines issued by the Board of Governors of the Federal Reserve System, fix the compensation of employees other than officers of the Bank. In addition to the foregoing, the president, or such officers as the president may authorize, may define the duties of and dismiss at pleasure officers of the Bank, except for the first vice president and the general auditor. In the absence or disability of the president, or during a vacancy in the office of president, the first vice president shall serve as chief executive officer of the Bank.

Article VI—Director Resignation Upon Material Change

A Director of the Bank or Branch must tender his or her resignation to the chair of the Board of Directors of the Bank, if the Director’s principal occupation or business association changes materially during his or her tenure as Director. The chair of the Board of Directors of the Bank, in consultation with the Bank’s president, shall review the appropriateness of continued Board service and recommend to the Board of Directors of the Bank whether to accept the Director’s resignation. If the material change of principal occupation or business association involves the chair, the resignation shall be tendered to the deputy chair, who will review the appropriateness of continued Board service with the president and recommend to the Board of Directors of the Bank whether to accept the chair’s resignation. The Director who tenders his or her resignation will be recused from any Bank Board of Directors or Branch Board of Directors’ deliberations until the matter has been resolved.

Article VII—Amendments

These bylaws may be amended at any meeting of the Board of Directors of the Bank by a majority vote of the entire Board, provided, however, that a copy of such amendment shall have been mailed to each member prior to such meeting.

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