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BOLI Resources

Bank-owned life insurance, as the name implies, is life insurance owned by the bank that insures against the lives of designated bank personnel, typically employees and directors, the proceeds of which (i.e., death benefits) help offset the costs of providing employee benefits and help the bank manage certain risks of loss. Cash flows from BOLI are generally income-tax free if policies are held to full term, and thus can provide attractive tax-equivalent yields to meet the bank’s obligations.

Resources

CBA has developed number of resources intended to assist bank management in communicating with the board and helping directors fulfill their fiduciary duties regarding the bank’s acquisition of BOLI. The resources include a summary of legal and regulatory guidance, a set of accompanying PowerPoint slides for board presentations and reproductions of regulatory guidance: OCC, Accounting and FASB.