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[¶10,971] In the Matter of Suburban Bank, Lake Worth, Florida, Docket No. FDIC-93-226PCAS (4-22-94).
FDIC orders bank to take prompt corrective action to restore capital adequacy. (This order was terminated by order of the FDIC dated 9-27-94; see ¶15,917.)
[.1] Capital—Increase/Maintain—Methods
[.2] Sale or Merge of Bank—Directors to Consider
In the Matter of
SUBURBAN BANK
LAKE WORTH,FLORIDA
(Insured State Nonmember Bank)
SUPERVISORY PROMPT
CORRECTIVE ACTION DIRECTIVE
FDIC-93-226PCAS
Suburban Bank, Lake Worth, Florida
{{11-30-94 p.C-3642}}("Bank"), being an undercapitalized insured depository institution as that term is defined in section 38(b)(1) of the Federal Deposit Insurance Act ("Act"), 12 U.S.C. § 1831 o(b)(1), and section 325.103 of the Federal Deposit Insurance Corporation ("FDIC") Rules and Regulations, 12 C.F.R. § 325.103, based upon the Bank's Report of Condition as of December 31, 1993, which shows its capital levels to be at a 3.77 percent Tier 1 leverage ratio, a 5.32 percent Tier 1 risk-based capital ratio, and a 6.57 percent total risk-based capital ratio, and having received a NOTICE OF INTENT TO ISSUE A SUPERVISORY PROMPT CORRECTIVE ACTION DIRECTIVE ("NOTICE") detailing the actions which will be required to be taken by the Bank and/or the proscriptions which will be imposed on the Bank pursuant to section 38 of the Act, 12 U.S.C. § 1831o, and section 308.201(a) of the FDIC Rules of Practice and Procedure, 12 C.F.R. § 308.201(a), and the Bank having filed a response to the NOTICE pursuant to section 308.201(c) of the FDIC Rules and Practice and Procedure, 12 C.F.R. § 308.201(c), and the FDIC having considered said response, and the FDIC having determined, pursuant to section 38(e)(5) of the Act, 12 U.S.C. § 1831o(e)(5), that it is necessary that certain actions described in section 38(f)(2) of the Act, 12 U.S.C. § 1831o(f)(2), be taken with respect to the Bank in order to carry out the purpose of section 38 of the Act, 12 U.S.C. § 1831o, the FDIC hereby issues this SUPERVISORY PROMPT CORRECTIVE ACTION DIRECTIVE pursuant to the provisions of section 38 of the Act, 12 U.S.C. § 1831o, and section 308.201(d) of the FDIC Rules of Practice and Procedure, 12 C.F.R. § 308.201(d).
SUPERVISORY PROMPT CORRECTIVE ACTION DIRECTIVE
[.1] IT IS HEREBY DIRECTED, that, within 60 days of the effective date of this SUPERVISORY PROMPT CORRECTIVE ACTION DIRECTIVE, or such longer period of time as may be approved by the FDIC in order for the Bank to consummate a merger or acquisition transaction with a third party which transaction would result in the Bank being adequately capitalized, the Bank shall sell enough shares or obligations of the Bank so that the Bank will be adequately capitalized, as that term is defined in section 38(b)(1) of the Act, 12 U.S.C. § 1831o(b)(1), and section 325.103 of the FDIC's Rules and Regulations, 12 C.F.R. § 325.103, after the sale, and that such shares which are sold shall be voting shares. The board of directors of the Bank shall adopt and implement a written plan for the sale of such additional securities, including the voting of any shares owned or proxies controlled by them in favor of the plan. Should the implementation of the plan involve a public distribution of the Bank's Securities (including a distribution limited only to the Bank's existing shareholders), the Bank shall prepare offering materials fully describing the securities being offered, including an accurate description of the financial condition of the Bank and the circumstances giving rise to the offering, and any other material disclosure necessary to comply with Federal securities laws. Prior to the implementation of the plan, and in any event not less than 15 days prior to the dissemination of such materials, the plan and any 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 plan or materials by the FDIC shall be made prior to their dissemination. In complying with the provisions of this paragraph, written notice shall be provided by the Bank to any subscriber and/or purchaser of Bank Securities detailing 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 shall be furnished within ten calendar days from the date such material development or change was planned or occurred, whichever is earlier, and shall be furnished to every purchaser and/or subscriber of Bank Securities who received or was tendered the information contained in the Bank's original offering materials.
[.2] FURTHER DIRECTED, that the Bank shall accept any pending offer acceptable to the Regional Director of the FDIC to be acquired by a depository institution holding company, or to combine with another insured depository institution, if and when the Bank is notified in writing by the FDIC that one or more grounds exist for appointing a conservator or receiver for the Bank under section 11(c)(5) of the Federal Deposit Insurance Act, 12 U.S.C. § 1821(c)(5).
FURTHER DIRECTED, that this SUPERVISORY PROMPT CORRECTIVE ACTION
{{11-30-94 p.C-3643}}DIRECTIVE shall become effective immediately upon its receipt by the Bank.
Each provision of this SUPERVISORY PROMPT CORRECTIVE ACTION DIRECTIVE shall be binding upon the Bank, its directors, officers, employees, agents, successors, assigns, and other institution-affiliated parties of the Bank.
Each provision of this SUPERVISORY PROMPT CORRECTIVE ACTION DIRECTIVE shall remain effective and enforceable until the Bank has been adequately capitalized on average for four consecutive calendar quarters, except to the extent that, and until such time as, any provision shall be modified, terminated, suspended, or set aside by the FDIC.
Dated at Washington, D.C., this 22nd day of April, 1994.
Pursuant to delegated authority.
