---
title: O.C.G.A. § 7-1-491. Financing involving directors or officers.
collection: code
id: 7-1-491
cite_as: O.C.G.A. § 7-1-491 (2025)
canonical_url: https://georgiacommons.org/code/7-1-491
md_url: https://georgiacommons.org/code/7-1-491.md
text_url: https://georgiacommons.org/code/7-1-491/text
source_url: https://www.legis.ga.gov/api/document/docs/default-source/joint-features-document-library/t7-t8-(v5)-2024-pdf.pdf?sfvrsn=6386add7_0#page=271
date: 2025
status: active
corpus_version: 2025-supplement-89aa39ab3c68
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publisher: Georgia Commons, an independent project of Georgia Civic Data. Not the State of Georgia. Not legal advice.
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version: the only printed version
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current_through: Including Acts of the 2025 Regular Session of the General Assembly
heading_path: BANKING AND FINANCE / FINANCIAL INSTITUTIONS / BANKS AND TRUST COMPANIES / MANAGEMENT
---

# O.C.G.A. § 7-1-491. Financing involving directors or officers.

In addition to other provisions in this chapter and federal law, a bank or trust company shall not make loans or otherwise extend financing to any one of its directors or policy-making officers except on terms, rates, and conditions which are not preferential. Preferential terms, rates, and conditions shall be determined by comparison to those terms, rates, and conditions offered contemporaneously to other borrowers making substantially similar loan requests, having substantially similar credit histories, and offering substantially similar collateral. Such loans shall be made only after the application of prudent loan underwriting criteria normally applied to loan requests of a similar nature from applicants who are not directors and policy-making officers. Approval procedures for such loans should be designed to minimize any potential abuse by bank insiders.

## History

Ga. L. 1919, p. 135, art. 19, §§ 11, 12; Ga. L. 1920, p. 102, § 1; Code 1933, §§ 13-2011, 13-2012; Ga. L. 1968, p. 329, § 1; Code 1933, § 41A-2212, enacted by Ga. L. 1974, p. 705, § 1; Ga. L. 1978, p. 1717, § 5; Ga. L. 1983, p. 602, § 12; Ga. L. 1984, p. 949, § 5; Ga. L. 1995, p. 673, § 18.

## Administrative Rules and Regulations

Loans and Discounts, Official Compilation of the Rules and Regulations of the State of Georgia, Rules of Department of Banking and Finance, Banks, Rule 80-1-5-.01 et seq.