The Board of Directors supervises the management of the business and affairs of Alterna Bank including all outsourcing agreements. It is ultimately responsible for the stewardship of the Bank. In undertaking its responsibilities, the Board, its Committees and any individual Director shall not directly manage or be involved in the day-to-day activities of Alterna Bank.

At a minimum, the Board of Directors’ role is to:

Clients

1. Act on behalf of and in the best interests of the clients of Alterna Bank.
2. Ensure that Alterna Bank has efficient and regular communication with its clients.

President & CEO and Senior Management

3. Select and designate an individual with appropriate ability, integrity and experience to fill the President & CEO position.
4. Define the duties and responsibilities of the President & Chief Executive Officer ("President & CEO").
5. On an annual basis, set the objectives for the President and CEO and evaluate the performance of the President & CEO against these objectives.
6. Delegate appropriate authorities to the President & CEO.
7. Appoint the Alterna Bank signing Officers.
8. Review proposed senior management appointments.
9. Require that the President & CEO and his direct reports be qualified, competent, act with integrity and be compensated in a manner that is consistent with appropriate prudential incentives.
10. Undertake succession planning for the position of President & CEO and other executive management positions.

Control Environment

11. Review and approve policies as per established schedule, including the following policies, which are to be reviewed by the Board directly:

• Board Education and Development Policy,
• Director Remuneration Policy,
• Director Qualifications Policy,
• Employee Incentive Pricing Policy,
• Governance Policy,
• Delegation of Authority to President and CEO Policy,
• Management Disclosure Policy, and
• Responsible Person Assessment Policy

12. Ensure, through periodic independent audits or inspections, the adherence to these policies.
13. Receive and review reports regarding compliance with legislation and with approved policies at regular intervals.
14. Review organizational structure and procedural controls, and satisfy themselves that these controls are operating effectively.
15. Ensure that controls and procedures are in place to safeguard clients’ deposits and preserve shareholder’s equity.
16. Ensure compliance with risk-related regulatory requirements.

Strategy and Direction

17. Establish the vision, mission and core values.
18. Establish, review and approve the Alterna Bank strategic plan.
19. Review and approve the annual performance targets as stated in the Alterna Bank Annual Operating Plan.
20. Monitor the business objectives of Alterna Bank, evaluate and approve its business strategies and its business plans for significant operations.

By-laws

21. Ensure that any enactment, amendment, restatement or repeal of any By-laws is presented for approval to the shareholder at the Annual Meeting of the Shareholder.

Board and Committees

22. Elect from among their members the Chair, the Vice Chair and the Chairs of the standing Committees of the Board. The Chair of the Conduct Review Committee shall be an external Director.
23. Monitor performance against business objectives, strategies and plans.
24. Ensure that committees, including their mandate, are established by a formal resolution of the board, that board members’ skills or interests correspond to the committee mandate, and that board members are regularly informed of each committee's activities, findings, conclusions and recommendations.
25. Ensure the committees and the Board annually assess their performance against their mandate.
26. Foster an ongoing development and education program for all Directors.
27. Demonstrate leadership, honesty and integrity through exemplary conduct in accordance with the Alterna Bank Code of Conduct for Directors.
28. Ensure an effective strategy for board succession planning and recruitment of highly qualified directors who represent the diversity of Alterna Bank clients.
29. Model and promote socially responsible values in Board discussions and actions.

Financial Statements

30. Approve the audited financial statements of Alterna Bank.

Shares and Dividends

31. Approve the purchase, redemption or issuance of any shares in the capital of Alterna Bank.
32. Declare dividends as appropriate and require their payment.

Relationship with Parent, Alterna Savings

33. Ensure that Alterna Bank has efficient and regular communication with its parent Alterna Savings.
34. Ensure that Alterna Bank is represented at Central 1 meetings, as applicable. The Delegate and Alternate to the Central 1 meetings will generally be the same as Alterna Savings; however, the Board of Alterna Bank reserves the right to appoint its own representatives when it deems appropriate.

Community

35. Foster linkages with local community organizations on issues of common concern.

Other

36. Approve loans and other transactions involving directors, officers and restricted parties.
37. Approve commercial and syndicated loans as applicable. and
38. Authorize the purchase, sale, lease, exchange or other disposition of material assets.