In my experience, specific technical financial expertise – which may be somewhat more difficult to find in smaller communities – is not nearly as important in this regard as board members’ ability to exercise sound and effective judgment regarding different risks confronting the bank and to take seriously their responsibility for the long-term interests of the bank.
The board of directors, along with a strong senior management team, can contribute substantially to the safe and sound operation of the bank by setting the “tone at the top” regarding activities and behaviors that are either encouraged or frowned upon. Well-informed managers and staff constitute another inner circle.