(1) An eligible state bank as defined in ARM 2.59.125 may engage in any derivative transaction if the bank has a written policy approved by its board of directors that:
(a) identifies the types of derivative transactions in which the bank is authorized to engage;
(b) establishes an exposure limit for each type of authorized derivative transaction and an aggregate exposure limit for all of the bank's authorized derivative transactions expressed in relation to the bank's lending limit;
(c) is consistent with bank safety and soundness principles; and
(d) requires the designation of an employee to be in charge of the bank's derivatives program who:
(i) has demonstrable expertise and understanding of derivative transactions; and
(ii) is responsible for periodic testing of the model(s) used to measure credit exposure against actual outcomes.