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{{10-31-00 p.C-2482.16}}
   [10,583] In the Matter of Danvers Savings Bank, Danvers, Massachusetts, Docket No. FDIC-92-202b (7-15-92).

   Bank to cease and desist from such unsafe or unsound practices as operating with excessive volumes of adversely classified assets; following hazardous lending and lax collection practices; operating with inadequate capital; operating with management policies detrimental to the Bank; engaging in practices which produce inadequate operating income; failing to provide adequate supervision over the Bank's affairs; operating with inadequate allowance for loan and lease losses; operating with inadequate liquidity; operating without proper internal routine and controls; operating with excessive investment in real estate development projects; and operating with excessive concentrations of credit. (This order was terminated by order of the FDIC dated 10-24-95. See ¶ 16,048.)

   [.1] Management—Qualifications—Review
   [.2] Management—Management Plan—Minimum Requirements
   [.3] Allowance for Loan and Lease Losses—Establish/Maintain
   [.4] Capital—Tier 1 Capital—Increase/Maintain—Methods
   [.5] Loans—Risk Position—Reduce—Written Plans Required
   [.6] Loans—Extensions of Credit—Existing Borrowers—Curtail
   [.7] Loans—Overdue—Accrual of Interest
   [.8] Loan Policy—Written Revision
   [.9] Profit Plan—Minimum Requirements
   [.10] Funds Management—Written Policy Required
   [.11] Bank Operations—Internal Routine and Controls—Written Policy Required
   [.12] Real Estate—Appraisal Policy Required
   [.13] Loans—Concentrations of Credit—Reduction Plan
   [.14] Compliance Reports—Frequency

In the Matter of

DANVERS SAVINGS BANK
DANVERS, MASSACHUSETTS
(Insured State Nonmember Bank)
ORDER TO CEASE
AND DESIST

FDIC-92-202b

   Danvers Savings Bank, Danvers, Massachusetts, ("Bank"), having been advised of its right to a Notice of Charges and of Hearing detailing the unsafe or unsound banking practices alleged to have been committed by the Bank and of its right to a hearing on such alleged charges under section 8(b)(1) of the Federal Deposit Insurance Act ("Act"), 12 U.S.C. § 1818(b)(1), and having waived those rights, entered into a STIPULATION AND CONSENT TO THE ISSUANCE OF AN ORDER TO CEASE AND DESIST ("CONSENT AGREEMENT") with counsel for the Federal Deposit Insurance Corporation ("FDIC"), dated June 19, 1992, whereby solely for the purpose of settling this pro-{{10-31-00 p.C-2482.17}}ceeding and without admitting any allegations or implications of fact or the existence of any unsafe or unsound banking practices, the Bank consented to the issuance of an ORDER TO CEASE AND DESIST ("ORDER") by the FDIC.
   The FDIC considered the matter and determined that it had reason to believe that the Bank had engaged in unsafe or unsound banking practices. The FDIC, therefore, accepted the CONSENT AGREEMENT and issued the following:

ORDER TO CEASE AND DESIST

   IT IS HEREBY ORDERED that the Bank and its institution-affiliated parties, as that term is defined in section 3(u) of the Act, 12 U.S.C. § 1813(u), cease and desist from the following unsafe or unsound banking practices:
   (a) operating with an excessive volume of adversely classified assets, including operating with an excessive volume of adversely classified loans and real estate joint ventures;
   (b) engaging in hazardous lending practices;
   (c) operating with inadequate Tier I leverage capital for the kind and quality of assets held;
   (d) engaging in management policies and practices which are detrimental to the Bank;
   (e) engaging in practices which produce inadequate operating income and excessive loan losses;
   (f) failing to provide adequate supervision and direction over the affairs of the Bank to prevent unsafe or unsound practices;
   (g) operating with an inadequate allowance for loan and lease losses for the volume, kind and quality of loans held;
   (h) operating with inadequate liquidity;
   (i) operating without proper internal routine and controls;
   (j) operating with excessive investment in real estate development projects; and,
   (k) operating with excessive concentrations of credit.
   IT IS FURTHER ORDERED that the Bank and its institution-affiliated parties, take affirmative action as set forth below. Solely for the purposes of enforcement of this ORDER, the Bank and its institution-affiliated parties shall not be deemed to be in violation of paragraphs (a) through (k) above, except to the extent that they are in violation of the following:

    [.1] 1. (a) The Bank shall continue to have and retain qualified management. At a minimum, such management will include a President and Senior Lending Officer. The President must have proven abilities in managing a bank of comparable size and experience in dealing with and upgrading a low quality loan portfolio. The Senior Lending Officer should have an appropriate level of lending, collection and loan supervision experience to manage the type and quality of the Bank's loans as well as the ability to upgrade a low quality portfolio. Such individuals shall be provided with the necessary written authority to implement the provisions of this ORDER. Such management shall also provide for an adequate audit function. The qualifications of management shall be assessed on its ability to take effective ac- {{9-30-92 p.C-2483}}tion toward the accomplishment of the following goals:
         (i) compliance with the requirements of this ORDER,
         (ii) operation of the Bank in a safe and sound manner,
         (iii) compliance with applicable laws and regulations, and,
         (iv) restoration of all aspects of the Bank to a safe and sound condition, including asset quality, capital adequacy, earnings, management effectiveness and liquidity.
During the life of this ORDER, the Bank shall notify the Regional Director of the Boston Regional Office ("Regional Director") in writing of any changes in management at the level of Vice President or above, in the manner and to the extent required by 12 C.F.R. § 303.14, with a copy of such notice to the Commissioner. The notification must include the names and background of any replacement personnel and must be provided prior to the individual's assuming the new position.

   [.2] (b) The Bank shall continue to adhere to the management plan submitted as a result of the July 31, 1991 MEMORANDUM OF UNDERSTANDING which includes:

       (i) identification of both the type and number of officer positions needed to manage and supervise properly the affairs of the Bank;
       (ii) identification and establishment of such Bank committees as are needed to provide guidance and oversight to active management;
       (iii) evaluation of each Bank officer at the level of Vice President or above, and in particular the President and Senior Lending Officer and staff members to determine whether these individuals possess the ability, experience and other qualifications required to perform present and anticipated duties, including adherence to the Bank's established policies and practices, and maintenance of the Bank in a safe and sound condition; and
       (iv) a requirements that each Bank Officer, staff member, or other person performing the duties normally performed by a Bank officer or staff member, be covered under the Bank's blanket bond;
       (v) evaluation of the advisability and appropriateness of using an outside consultant to perform duties normally performed by a bank officer or staff member; and
       (vi) a plan of action to recruit and hire any additional or replacement personnel with the requisite ability, experience and other qualifications, which the Board of Trustees determines are necessary to fill Bank officer or staff member positions consistent with the Board's analysis, evaluation and assessment as provided in paragraphs 1(b)(i), 1(b)(iii) and 1(b)(v) of this ORDER.
The management plan submitted under the July 31, 1991 MEMORANDUM OF UNDERSTANDING, shall be amended to include a written analyses and assessment of the audit function of the bank, which shall include, at a minimum, items (i), (ii), (iii), and (iv) of this paragraph 1(b). The recommendations of the Bank's Compliance Committee will be reviewed in detail by the full Board of Trustees and incorporated into their minutes.
   (c) The amendment to the written management plan shall be submitted to the Regional Director and the Commissioner for review and comment within sixty (60) days from the effective date of this ORDER. No sooner than thirty (30) days, but under no circumstances more than sixty (60) days after such submission, the Board of Trustees shall approve the amendment to the written management plan, taking into consideration any comments received from the Regional Director and/or the Commissioner within such thirty-day period, and such approval shall be recorded in the minutes of the Board of Trustees. Subsequent modifications to the written management plan may be made only after giving the Regional Director and the Commissioner written notice of the proposed modification, and after consideration of any responsive comments submitted by the Regional Director and/or the Commissioner within thirty (30) days from their receipt of the notice of proposed modification. No such modification shall become effective until approved by the Board of Trustees, and such approval shall be recorded in the minutes of {{9-30-92 p.C-2484}}the Board of Trustees. The Bank, its trustees, officers and employees shall implement and follow the amended written management plan and/or any subsequent modification thereto.
    (d) (i) The written management plan shall continue to include the requirement that the Board of Trustees of the Bank, or a committee, or committees, thereof consisting of not less than a majority of Board members who are independent with respect to the Bank, provide supervision over lending, investment and operating policies of the Bank sufficient to ensure that the Bank complies with the provisions of this ORDER.
       (ii) At the next meeting of the nominating committee of the Bank, and at each succeeding meeting of that committee at which individuals are nominated for the office of trustee, the committee shall nominate individuals who are independent with respect to the Bank in such number as is necessary to cause a majority of the Board of Trustees to be and to remain independent with respect to the Bank.
       (iii) For purposes of this ORDER, an individual who is "independent with respect to the Bank" shall be any individual (1) who is not an officer of the Bank or any of its affiliated organizations, (2) who is not related by blood, marriage or common financial interest to an officer of the Bank, and (3) who is not indebted to the Bank, directly or indirectly (including the indebtedness of any entity in which the individual has a substantial financial interest), in an amount exceeding five (5.0) percent of the Bank's total equity capital and allowance for loan and lease losses.
   (e) The Bank's Board of Trustees shall continue to meet at least monthly. The Board shall continue to prepare in advance and shall follow a detailed written agenda at each meeting, which shall include consideration of actions of any committees. A chronological file of all written agendas shall continue to be maintained. Notwithstanding the foregoing, the Board shall not be precluded from considering matters other than those contained in the agenda. Detailed written minutes of all Board meetings shall continue to be maintained and recorded on a timely basis.

[.3] 2. (a) Within ten (10) days from the effective date of this ORDER, the Bank shall have increased its allowance for loan and lease losses ("Reserve") existing as of December 2, 1991 by $350,000 at a minimum.
   (b) Immediately after complying with paragraph 2(a), the Bank shall, to the extent it has not already done so, eliminate from its books, by charge-off, establishment of a specific reserve or collection, all assets or portions of assets classified "Loss" and fifty (50.0) percent of all assets or portions of assets classified "Doubtful" in the joint FDIC/State Report of Examination of the Bank as of December 2, 1991 ("Examination"), which have not been previously collected or charged off. Reduction of these assets through use of proceeds of loans made by the Bank, other than to qualified third party borrowers, does not constitute "collection" or "elimination" for the purpose of this paragraph.
   (c) Thereafter, the Bank shall maintain its Reserve in accordance with the prevailing requirements of the Instructions for the Reports of Condition and Income ("Instructions"). Toward this end, by the effective date of this ORDER, the Bank's Board of Trustees, with the assistance of management, shall amend its policy for determining the adequacy of the Bank's Reserve to address the weakness(es) detailed on page 1-a-11 of the December 2, 1991 joint FDIC/State Report of Examination. The policy shall provide for a review of the Reserve at least once each calender quarter. The review should focus on the results of the Bank's internal loan review, loan loss experience, trends of delinquent and non-accrual loans, an estimate of potential loss exposure on significant credits, concentrations of credit, and present and prospective economic conditions. Review of other real estate owned, including joint ventures, and exposure therein shall be undertaken along the same lines as the aforementioned loan portfolio review, with any changes necessary to record such assets at fair market value immediately charged to operating expense. The adequacy of the Reserve in relation to the loss potential in the loan portfolio will be reviewed by the Board of {{9-30-92 p.C-2485}}Trustees and adjustments to the Reserve will be made accordingly. Details of these reviews will be incorporated into the minutes of the Board of Trustees, including the factors considered and/or methodology used to determine the adjustments made.

    [.4] 3. (a) (i) The Bank's Board of Directors will take all steps necessary to increase, by September 30, 1992, the Bank's Tier 1 capital to a level at or in excess of five (5.0) percent of the Bank's total assets ("Tier 1 leverage capital ratio") and shall continue to maintain its Tier 1 leverage capital ratio at or above such level until March 31, 1993. The Bank's Board of Directors will take all steps necessary to increase, by March 31, 1993, the Bank's Tier 1 leverage capital ratio to a level of at least five and one-half (5.5) percent and shall continue to maintain its Tier 1 leverage capital ratio at or above such level until September 30, 1993. The Bank's Board of Directors will take all steps necessary to increase, by September 30, 1993, the Bank's Tier 1 leverage capital ratio to a level of at least six (6.0) percent and shall continue to maintain its Tier 1 leverage capital ratio at or above such level until March 31, 1994. The Bank's Board of Directors will take all steps necessary to increase, by March 31, 1994, the Bank's Tier 1 leverage capital ratio to a level of at least six and one-quarter (6.25) percent and shall continue to maintain its Tier 1 leverage capital ratio at or above such level until September 30, 1994. The Bank's Board of Directors will take all steps necessary to increase, by September 30, 1994, the Bank's Tier 1 leverage capital ratio to a level of at least six and one-half (6.5) percent and shall continue to maintain its Tier 1 leverage capital ratio at or above such level until March 31, 1995. The Bank's Board of Directors will take all steps necessary to increase, by March 31, 1995, the Bank's Tier 1 leverage capital ratio to a level of at least six and three-quarters (6.75) percent and shall continue to maintain its Tier 1 leverage capital ratio at or above such level until September 30, 1995. The Bank's Board of Directors will take all steps necessary to increase, by September 30, 1995, the Bank's Tier 1 leverage capital ratio to a level of at least seven (7.0) percent and shall continue to maintain its Tier 1 leverage capital ratio at or above such level while this ORDER is in effect. Toward this end, the Bank shall develop a revised Capital Plan which will be submitted to the Regional Director and the Commissioner for approval within sixty (60) days of the effective date of this ORDER. The Capital Plan should address both internal and external sources of capital augmentation, including capital infusions, retention of earnings, restrictions of asset growth and asset sales.
       (ii) For purposes of this ORDER, the terms "Tier 1 capital" and "total assets" shall have the meanings ascribed to them in the revised Part 325 of the FDIC's Rules and Regulations, 12 C.F.R. Part 325, which became effective April 10, 1991.
   (b) In calculating the Bank's Tier 1 leverage capital ratio under paragraph 3(a) initially, the Bank shall first comply fully with paragraphs 2(a) and (b) of this ORDER. Thereafter, such ratio and its component parts shall be determined only after the Bank has made such additions to its Reserve so as to bring the Reserve into compliance with the prevailing requirements of the Instructions and charged off any losses identified subsequent to the Examination.
   (c) Any increase in the Tier 1 leverage capital ratio made by the Bank in order to meet the requirements of paragraph 3(a) of this ORDER may be accomplished by:
       (i) the sale of new offerings of common stock or perpetual preferred stock;
       (ii) the retention of earnings;
       (iii) the collection of all or part of assets classified: (A) "Loss" in the Examination, without loss or liability to the Bank, or (B) "Doubtful" in the Examination, without further or additional loss or liability to the Bank, provided any collection on such assets shall first be applied to that portion of the asset which was not charged off pursuant to paragraph 2 of this ORDER. Reductions to loans and leases classified "Loss" and "Doubtful" shall first be credited to the remaining balance outstanding with regard to such loans and leases and the remainder, if any, then to {{9-30-92 p.C-2486}}the Reserve and, if the Board of Directors' review of the adequacy of the Reserve required by paragraph 2 of this ORDER indicates that the Reserve has a balance in excess of that required for adequacy, any such excess may be transferred to equity capital through a negative provision to the Reserve;
       (iv) the collection in cash of assets previously charged off;
       (v) the reduction of the overall size of the Bank through the sale of assets or other means;
       (vi) any combination of the above means; or
       (vii) any other means acceptable to the Regional Director and the Commissioner.
   (d) If, after having achieved the Tier 1 leverage capital ratio specified in paragraph 3(a)(i), such ratio declines below the level agreed upon at the particular point in time as provided by paragraph 3(a)(i), the Bank, within thirty (30) days after the date which said ratio so declined, shall submit a written plan to the Regional Director and the Commissioner for increasing such ratio up to or in excess of such level as calculated herein while this ORDER is in effect. Upon approval by the Regional Director and the Commissioner, the Bank shall immediately implement the written plan.
   (e) In addition to the requirements of paragraphs 3(a)-(d), the Bank shall comply with the FDIC's Statement of Policy on Risk-Based Capital found in Appendix A to Part 325 of the FDIC Rules and Regulations, 12 C.F.R. Part 325, App. A.
   (f) If all or part of any increase in capital made by the Bank in order to meet the requirements of this paragraph 3 involves an offering, other than an offering deemed not to be a public securities offering pursuant to 17 C.F.R. § 230.506 as currently in effect or as hereafter amended, of the Bank's securities, the Bank shall prepare detailed offering materials fully describing the securities being offered, including an accurate description of the financial condition of the Bank and of this ORDER as well as the circumstances giving rise to the offering, and any other material disclosures necessary to comply with the Federal securities laws. Prior to the sale of the securities, and, in any event not less than twenty (20) days prior to the dissemination of such materials, the materials used in the sale of the securities shall be submitted to the FDIC, Registration and Disclosure Section, Washington, D.C. 20429, for review. Any changes requested to be made in the materials by the FDIC shall be made prior to their dissemination.
   (g) In complying with the provisions of paragraph 3(f) of this ORDER, the Bank shall provide to any subscriber and/or prospective purchaser of Bank stock, prior to the sale of the securities, written notice of any planned or existing development or other change which is materially different from the information reflected in any offering materials used in connection with the sale of Bank securities. The written notice required by this paragraph 3(g) shall be furnished within ten (10) calendar days from the date such material development or change was planned or occurred, whichever is earlier, to every purchaser and/or subscriber of Bank stock who received or was tendered the information contained in the Bank's original offering materials.
   (h) The Bank's Board of Trustees shall maintain in its minutes a written record of all actions taken by the Bank to comply with the capital requirements of paragraph 3(a) through 3(g) of this ORDER, including, at a minimum, any action to increase its Tier 1 capital by each of the methods specified in paragraphs 3(c)(i) through 3(c)(vii) of this ORDER.

[.5] 4. (a) Within sixty (60) days of the effective date of this ORDER, the Board of Trustees, with the assistance of management, shall develop a written plan of action to lessen the Bank's risk position with respect to each borrower who or which had outstanding principal debt owing to the Bank in excess of $300,000, and each joint venture investment in excess of $300,000 which was classified "Substandard" or "Doubtful," in whole or in part, in the Examination. In developing such plan, the Bank shall, at a minimum:

       (i) in the case of loans, review the financial position of each such borrower, including source or repayment, repayment ability, and alternative repayment sources, and evaluate the available collateral for each such credit, including possible actions to improve the Bank's collateral position; and; {{9-30-92 p.C-2487}}
       (ii) in the case of other real estate owned and joint ventures, evaluate the property and provide cost/benefit analyses of holding the property versus current liquidation value.
Based upon such review and evaluation, the written plan of action shall: (A) within six (6) and twelve (12) months from the effective date of this ORDER, establish target dollar levels to which the Bank shall reduce the aggregate dollar volume of "Substandard" or "Doubtful" classifications in the Examination as well as any additional assets that are in need of criticism according to internal Bank review; and (B) provide for the submission of written monthly progress reports for all loans, other real estate owned and joint ventures in excess of $300,000 that were classified "Substandard" or "Doubtful" in the Examination as well as any additional assets that are in need of criticism according to internal Bank review to the Bank's Board of Trustees for review and notation in the minutes of the Board of Trustees. Such information shall be in the form of Exhibit A attached hereto, or in any other form that includes such information as is contained in Exhibit A. As used in the this paragraph 4, "reduce" means to (1) collect, (2) charge off, or (3) improve the quality of such assets so as to warrant removal of any adverse classification by the FDIC and the Division of Banks, Commonwealth of Massachusetts. Payment of loans with the proceeds of the other loans made by the Bank, other than those made to qualified third party borrowers, will not constitute "reduction" or "collection" for purposes of this ORDER.
   (b) The written plan of action described by paragraph 4(a) shall be submitted to the Regional Director and the Commissioner for review and comment within sixty (60) days from the effective date of this ORDER. No sooner than thirty (30) days, but under no circumstances more than sixty (60) days after such submission, the Board of Trustees shall approve the written plan of action, taking into consideration any comments received from the Regional Director and/or the Commissioner within such thirty-day period, and such approval shall be recorded in the minutes of the Board of Trustees. Subsequent modifications to the written plan may be made only after giving the Regional Director and the Commissioner written notice of the proposed modification, and after consideration of any responsive comments submitted by the Regional Director and/or the Commissioner within thirty (30) days from their receipt of the notice of proposed modification. No such modification shall become effective until approved by the Board of Trustees, and such approval shall be recorded in the minutes of the Board of Trustees. The Bank, its trustees, officers and employees shall follow the written plan of action and/or any subsequent modification thereto.

   [.6] 5. The bank shall not extend or renew, directly or indirectly, credit, to, or knowingly for the benefit of, any borrower who or which, as of the Examination, has a loan or other extension of credit with the Bank that has been charged off or classified, in whole or in part, "Loss," "Doubtful," or "Substandard," and is uncollected, unless a majority of the Bank's Board of Trustees first (1) determines that such extension or renewal is in the best interest of the Bank, (2) determines that the Bank has satisfied the requirements set out in paragraph 4 of this ORDER as to such borrower, if applicable, and (3) approves such extension or renewal. A written record of the Board of Trustees' determination and approval of any extension or renewal under the terms of this paragraph 5 shall be maintained in the credit file of the affected borrower(s) as well as the minutes of the Board of Trustees. Notwithstanding the foregoing provisions, this ORDER shall not require such approvals by the Board of Trustees for extensions of credit made pursuant to a legally binding contractual commitment entered into by the Bank prior to the effective date of this ORDER.

   [.7] 6. The Bank shall not accrue interest on any loan that is, or becomes, ninety (90) days or more delinquent as to principal or interest, unless the loan is both well secured and in the process of collection. For purposes of this paragraph 6, "well secured" and "in the process of collection" shall have the same meaning as those terms have in the prevailing Instructions for the Reports of Condition and Income. The Bank shall reverse on its books all previously accrued but uncollected interest on any loan that has ceased to accrue interest pursuant to this provision.

   [.8] 7. The Bank, its trustees, officers, {{9-30-92 p.C-2488}}and employees shall continue to follow the written loan policy approved by the Board of Trustees at the October 11, 1991 meeting pursuant to the July 31, 1991 MEMORANDUM OF UNDERSTANDING.

    [.9] 8. (a) Within sixty (60) days of the effective date of this ORDER, the Bank shall develop a revised written profit plan consisting of goals and strategies for improving the earnings of the Bank, which written profit plan shall include, at a minimum:
         (i) identification of the major areas in, and means by, which the Board of Trustees will seek to improve the Bank's operating performance;
         (ii) realistic and comprehensive budgets;
         (iii) a budget review process to monitor the income and expenses of the Bank to compare actual figures with budgetary projections; and
         (iv) a description of the operating assumptions that form the basis for, and adequately support, major projected income and expense components.
       (b) The written profit plan shall be submitted to the Regional Director and the Commissioner for review and comment within sixty (60) days from the effective date of this ORDER. No sooner than thirty (30) days, but under no circumstances more than sixty (60) days after such submission, the Board of Trustees shall approve the written profit plan, taking into consideration any comments received from the Regional Director and/or the Commissioner within such thirty-day period, and such approval shall be recorded in the minutes of the Board of Trustees. Subsequent modifications to the written profit plan may be made only after giving the Regional Director and the Commissioner written notice of the proposed modification, and after consideration of any responsive comments submitted by the Regional Director and/or the Commissioner within thirty (30) days from their receipt of the notice of proposed modification. No such modification shall become effective until approved by the Board of Trustees, and such approval shall be recorded in the minutes of the Board of Trustees. The Bank, its trustees, officers, and employees shall follow the written profit plan and/or any subsequent modification thereto.

   [.10] 9. The Bank, its trustees, officers and employees shall follow the written funds management policy approved by the Board of Trustees October 11, 1991 pursuant to the July 31, 1991 MEMORANDUM OF UNDERSTANDING, and/or any subsequent modification thereto. Subsequent modifications to the written funds management policy may be made only after giving the Regional Director and the Commissioner written notice of the proposed modification, and after consideration of any responsive comments submitted by the Regional Director and/or the Commissioner within thirty (30) days from their receipt of the notice of proposed modification. No such modification shall become effective until approved by the Board of Trustees, and such approval shall be recorded in the minutes of the Board of Trustees.

   [.11] 10. Within sixty (60) days from the effective date of this ORDER, the Bank shall develop a plan of action to correct all exceptions noted for Internal Routines and Controls on pages 6-a, and Internal Routine and Controls-In House Data Processing on pages 6-c of the Examination. Such plan shall also provide for the implementation of procedures to ensure the aforementioned deficiencies do not recur.

   [.12] 11. By the effective date of the ORDER, the Bank's Board of Trustees shall establish a comprehensive policy requiring the adequate appraisal and periodic reappraisal of all other real estate owned and joint ventures in which the Bank is invested. All appraisals made pursuant to this paragraph 10 shall be made in accordance with the minimum appraisal guidelines defined in Part 323 of the FDIC's Rules and Regulations, 12 C.F.R. part 323, as existing on the effective date of this ORDER and as hereinafter amended. Copies of all appraisals made pursuant to this paragraph 10, in excess of $300,000 shall be submitted to the Regional Director and the Commissioner for their review.

    [.13] 12. (a) Within (60) days from the effective date of this ORDER, the Bank shall formulate and implement a plan to reduce all concentrations as noted on page 2-b of the Examination to less than twenty-five (25.0) percent of the Bank's Tier 1 capital.

   [.14] 13. Within forty-five (45) days from the end of each calendar quarter, the Bank shall furnish written progress reports to the {{12-31-93 p.C-2489}}Regional Director and the Commissioner detailing the form and manner of any action taken to secure compliance with this ORDER and the results thereof. In addition, the Bank shall furnish such reports on request of either the Regional Director or the Commissioner. All progress reports and other written responses to this ORDER shall be reviewed by the Board of Trustees of the Bank and made a part of the minutes of the Board meeting.
   This ORDER shall become effective ten (10) days from the date of its issuance.
   The provisions of this ORDER shall be binding upon the Bank and its institution- affiliated parties.
   This ORDER has been reviewed and concurred in by the Commissioner.
   The ORDER supersedes and replaces the MEMORANDUM OF UNDERSTANDING dated July 31, 1991, among the Bank's Board of Directors, the FDIC and the Commissioner, which is of no further force and effect.
   The provisions of this ORDER shall remain effective and enforceable except to the extent that, and until such time as, any provisions of this ORDER shall have been modified, terminated, suspended, or set aside by the FDIC.
   Dated at Needham, Massachusetts this 1st day of July, 1992.
   Pursuant to delegated authority.

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