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FDIC Enforcement Decisions and Orders

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   [11,744A] In the Matter of Maryland Permanent Bank & Trust Company, Owings Mills, Maryland,Docket No. 00-107b (11-17-00).

   A cease and desist order was issued, based on findings by the FDIC that it had reason to believe that respondent had engaged in unsafe and unsound practices. (This order was terminated by order of the FDIC dated 12-19-02; see ¶16,324.)

   [.1] Management—Qualifications Specified

   [.2] Management—Management Report Required

   [.3] Capital—Maintain Capital Ratio

   [.4] Loan Loss Reserve—Policy for Determining Accuracy of

   [.5] Earnings Plan—Written Earnings Plan Required

   [.6] Bank Operations—Conflict of Interest Policy Regarding Insiders Required

   [.7] Assets—Adversely Classified Assets—Reduction Required

   [.8] Assets—Charge-off or Collection

   [.9] Assets—Special Mention—Eliminate Deficiencies

   [.10] Loans—Extensions of Credit—To Borrowers with Existing Adversely Classified Credits

   [.11] Assets—Problem Assets—Individual Written Plans Required

   [.12] Loan Policy—Preparation or Revision of Policy Required

   [.13] Loans—Internal Grading System Required

   [.14] Loans—Internal Review Procedure

   [.15] Violations of Law—Correction of Violations Required

   [.16] Funds Management and Liquidity—Preparation or Revision of Funds Management Policy Required

   [.17] Bank Operations—Internal Routine and Control Procedures—Written Plan Required

   [.18] Dividends—Dividends Restricted

   [.19] Bank Holding Company—Policy Required

   [.20] Board of Directors—Committee to Review Compliance with Cease and Desist Order Required

In the Matter of:
MARYLAND PERMANENT BANK & TRUST COMPANY
OWINGS MILLS, MARYLAND
(Insured State Nonmember Bank)
ORDER TO CEASEAND DESIST

FDIC-00-107b

   Maryland Permanent Bank & Trust Company, Owings Mills, Maryland ("Insured Institution"), having been advised of its right to a Notice of Charges and of Hearing detailing the unsafe or unsound banking practices and violations of law and/or regulations alleged to have been committed by the Insured Institution and of its right to a hearing on the 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 October 16, 2000, whereby, solely for the purpose of this proceeding and without admitting or denying the alleged charges of unsafe or unsound banking practices and violations of law and/or regulations, the Insured Institution 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 Insured Institution had engaged in the
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   unsafe or unsound banking practices and had committed violations of law and/or regulations. The FDIC, therefore, accepted the CONSENT AGREEMENT and issued the following:

ORDER TO CEASE AND DESIST

   IT IS HEREBY ORDERED that the Insured Institution, its directors, officers, employees, and other institution-affiliated parties, as that term is defined in Section 3(u) of the Act, 12 U.S.C. §1813(u), and its successors and assigns, cease and desist from the following unsafe and unsound banking practices and violations of law and/or regulations:

       (a) Engaging in hazardous lending and lax collection practices;

       (b) Operating the Insured Institution with inadequate capital in relation to the kind and quality of assets held by the Insured Institution;

       (c) Operating the Insured Institution with an excessive volume of poor quality assets;

       (d) Operating the Insured Institution with an inadequate allowance for loan and lease losses;

       (e) Operating the Insured Institution with inadequate liquidity and funds management;

       (f) Operating the Insured Institution with inadequate internal routine and controls;

       (g) Operating the Insured Institution in such a manner as to produce unsatisfactory earnings;

       (h) Engaging in violations of applicable Federal and State laws and/or regulations, as more fully set forth in the joint Report of Examination of the Insured Institution by the FDIC and the Division of Financial Regulation of the State of Maryland ("Division") as of March 31, 2000;

       (i) Operating the Insured Institution with management whose policies and practices are detrimental to the Insured Institution and jeopardize the safety of its deposits;

       (j) Operating the Insured Institution with a board of directors which has failed to provide adequate supervision over and direction to the operating management of the Insured Institution; and

       (k) Operating the Insured Institution with an excessive reliance upon volatile funding.

   IT IS FURTHER ORDERED, that the Insured Institution take affirmative action as follows:

   [.1] 1. (a) Within 60 days from the effective date of this ORDER, the Insured Institution shall have management qualified to restore the Insured Institution to a sound condition. Such management shall include a chief executive officer who shall be given stated written authority by the Insured Institution's board of directors. Such written authority shall include the responsibility for implementing and maintaining lending policies and other Insured Institution policies in accordance with sound banking practices.

   (b) During the life of this ORDER, the Insured Institution shall notify the Regional Director of the New York Regional Office of the FDIC ("Regional Director") and the Commissioner of Financial Regulation of the State of Maryland ("Commissioner") in writing of any resignations and/or terminations of any members of its board of directors and/or any of its officers.

   (c) The Insured Institution shall comply with section 32 of the Act, 12 U.S.C. §1831i, which includes a requirement that the Insured Institution shall notify the Regional Director in writing at least 30 days prior to any individual assuming a new position or any additions to its board of directors and/or senior executive officers.

   [.2].2 (a) Within 60 days from the effective date of this ORDER, the board of directors of the Insured Institution shall review and make a written report on the Insured Institution's management needs in the lending area ("Management Report"). The Management Report shall incorporate an analysis of the Insured Institution's management and staffing requirements and shall, at a minimum:

       (i) identify both number and type of positions needed to properly supervise the Insured Institution's lending functions, giving appropriate consideration to the Insured Institution's loan volume, customer base and the number of problem credits;

       (ii) provide a clear and concise description of the general duties and responsibilities of lending officers and their support staff;

       (iii) identify the skills, experience and pay required for each position;

       (iv) provide an evaluation of the Insured Institution's senior management and lending officials, indicating whether bank officials possess the necessary lending and collection experience and qualifications
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       required to adequately perform present and anticipated duties;

       (v) establish a plan to recruit, hire and/or replace personnel based on ability and experience;

       (vi) establish a plan providing for periodic evaluation of each individual's job performance; and

       (vii) provide for periodic review of the Insured Institution's management and updating of lending policies and procedures.

   (b) Within 90 days from the effective date of this ORDER, the board of directors of the Insured Institution shall prepare a written plan of implementation ("Plan") addressing the findings of the Management Report. The Plan shall specify the actions to be taken by the board of directors and the time frames for each action.

   (c) A copy of the Management Report and Plan shall promptly be submitted to the Regional Director and the Commissioner for review and comment. Within 30 days from receipt of all comments, and after consideration of such comments, the board of directors of the Insured Institution shall approve the Management Report and Plan, which approval shall be recorded in the minutes of the meeting of the board of directors. It shall remain the responsibility of the board to fully implement the Plan within the specified time frames. In the event the Plan, or any portion thereof, is not implemented, the board shall immediately advise the Regional Director and the Commissioner, in writing, of the specific reasons for deviating from the Plan.

   [.3] .3 The Insured Institution shall maintain its total risk-based capital ratio, Tier 1 risk-based capital ratio, and leverage ratio at levels which, but for section 325.103(b)(1)(iv) of Part 325 of the FDIC's Rules and Regulations, would be sufficient for it to be deemed well capitalized within the meaning of section 325.103(b)(1). For the purposes of this ORDER, the terms total risk-based capital ratio, Tier 1 risk-based capital ratio, and leverage ratio will have the meanings ascribed to them in Part 325 of the FDIC's Rules and Regulations, respectively sections 325.2(w), 325.2(u) and 325.2(k).

   [.4] .4 (a) Within 30 days from the effective date of this ORDER, the board of directors of the Insured Institution shall adopt a method of computing the balance of the Insured Institution's allowance for loan and lease losses that gives consideration to the volume and composition of criticized loans, including, but not limited to (1) results of the Insured Institution's internal loan review, (2) loan loss experience, (3) an estimate of potential loss exposure on each significant credit, (4) concentrations of credit in the Insured Institution, and (5) present and prospective economic conditions. Immediately thereafter, the board of directors of the Insured Institution shall review the adequacy of the Insured Institution's allowance for loan and lease losses utilizing the method adopted pursuant to this paragraph, and shall make such additional provisions for loan and lease losses that are necessary to maintain the allowance at an adequate level relative to the volume of risk in the Insured Institution's loan portfolio. Thereafter, the Insured Institution's board of directors shall, during the first month of each quarter, reevaluate the allowance for loan and lease loses and make such additional provisions for loan and lease losses that are necessary to maintain the allowance at an adequate level relative to the volume of risk in the Insured Institution's loan portfolio. All such additional provisions for loan and lease losses shall be made in the first month of the calendar quarter in which the deficiency in the allowance is identified, but as of the end of the preceding calendar quarter, and shall be reflected in the Report of Condition and Income filed in the calendar quarter in which the deficiency is identified with respect to the preceding calendar quarter. The minutes of the board of directors of the Insured Institution shall reflect that such reevaluation has been performed, and documentary proof of the method employed in determining the level of the allowance shall be maintained for future regulatory revew.

   (b) All increases in the allowance for loan and lease losses, with the exception of recoveries credited directly to the allowance, shall be accomplished by charges to operating earnings through the provision for loan and lease losses.

   (c) All references to loans in this ORDER shall be deemed to include all other forms of extensions of credit.

   [.5] .5 (a) Within 90 days from the effective date of this ORDER, and within the first 30 days of each calendar year thereafter, the board of directors of the Insured Institution shall develop a written earnings plan con
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   sisting of goals and strategies for improving the earnings of the Insured Institution for each calendar year. The written earnings plan shall include, at a minimum:

       (i) identification of the major areas in, and means by, which the board of directors will seek to improve the Insured Institution's operating performance;

       (ii) realistic and comprehensive budgets;

       (iii) a budget review process to monitor the income and expenses of the Insured Institution to compare actual figures with budgetary projections on not less than a quarterly basis; and

       (iv) a description of the operating assumptions that form the basis for, and adequately support, major projected income and expense components.

   (b) Such written earnings plan and any subsequent modification thereto shall be submitted to the Regional Director and the Commissioner for review and comment. Within 30 days from receipt of all comments from the Regional Director and the Commissioner, the board of directors shall approve the written earnings plan, which approval shall be recorded in the minutes of the meeting of the board of directors of the Insured Institution. Thereafter, the Insured Institution shall follow the written earnings plan and/or any subsequent modification thereto.

   [.6] .6 Within 60 days from the effective date of this ORDER, the Insured Institution shall develop, adopt and implement written policies and procedures designed to bring to the attention of each member of the board of directors conflicts of interest which may arise due to the director's participation in the review, consideration or approval of an extension of credit or other transaction in which any officers, directors or principal stockholders of the Insured Institution ("Insiders") are directly or indirectly involved. Such policies and procedures shall, at a minimum, ensure that each member of the board has been apprised of any potential conflict prior to participating in the review or consideration of such transaction(s) in which Insiders and/or their business associates are, directly or indirectly, involved. The results of board deliberations as to potential conflicts shall be reflected in the minutes of the meeting of the board of directors.

   [.7] .7 Within 10 days from the effective date of this ORDER, the Insured Institution shall eliminate from its books, by collection or charge-off, all assets or portions of assets classified "Loss" and 50 percent of all assets or portions of assets classified "Doubtful" by the FDIC and the Division as a result of their joint examination of the Insured Institution as of March 31, 2000, which have not been previously charged of or collected. In addition, and so long as this ORDER remains in effect, the Bank shall, within 30 days from the receipt of any subsequent Report of Examination of the Insured Institution from the FDIC or the Division, eliminate from its books, by collection or charge-off, all assets or portions of assets classified "Loss" and 50 percent of all assets or portions of assets classified "Doubtful" in said Reports of Examination. Elimination of these assets through the use of the proceeds of loans or other extensions of credit made by the Insured Institution does not constitute collection for the purposes of this ORDER.

   [.8] .8 (a) Within 180 days from the effective date of this ORDER, the Insured Institution shall reduce the remaining total of all assets classified "Doubtful" and "Substandard" by the FDIC and the Division as a result of their joint examination of the Insured Institution as of March 31, 2000, to not more than 50 percent of Tier 1 capital plus allowance for loan and lease losses.

   (b) As used in this ORDER, the word "reduce" means (1) to collect, (2) to charge off, or (3) to improve the quality of adversely classified assets sufficiently to warrant removing any adverse classification, as determined by the FDIC and the Division. Reduction of these assets through the use of the proceeds of loans or other extensions of credit made by the Insured Institution does not constitute collection for the purposes of this ORDER. The requirements of this paragraph shall not be construed as a standard for future operation of the Insured Institution.

   [.9] .9 Within 60 days from the effective date of this ORDER, the Insured Institution shall take all necessary steps to eliminate all deficiencies noted in all assets scheduled as "Special Mention" by the FDIC and the Division as a result of their joint examination of the Bank as of March 31, 2000, and within 60 days from the receipt of any subsequent Report of Examination from the FDIC or the Division, the Insured Institution shall take the necessary steps to eliminate all deficiencies noted in all assets scheduled as "Special Mention" in each such Report.
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   [.10] .10 (a) Immediately upon the effective date of this ORDER, the Insured Institution shall not extend, either directly or indirectly, any new or additional credit (which, for the purposes of this ORDER, shall include the granting of renewals or extensions, or the capitalizing of accrued interest), to or for the benefit of any borrower who is obligated in any manner to the Insured Institution on any extension of credit, or portion thereof, which has been charged off the books of the Insured Institution, in whole or in part, or to any affiliate or related interest of, or other person or entity associated with, any such borrower ("charged-off borrower"), so long as any portion of such extension of credit, whether or not that portion was charged off, remains uncollected. The provisions of this paragraph 10(a) shall not apply to the advance of funds by the Insured Institution for the sole purpose of maintaining or protecting the Insured Institution's real estate collateral for any extension of credit, up to a maximum amount of $100,000 in the aggregate for all such advances, with respect to each real estate property securing, in whole or in part, all such extensions of credit.

   (b) Immediately upon the effective date of this ORDER, the Insured Institution shall not extend, either directly or indirectly, any new or additional credit to or for the benefit of any borrower who is obligated in any manner to the Insured Institution on any extension of credit that has been adversely classified, in whole or in part, by the FDIC or the Division as a result of their joint examination of the Insured Institution as of March 31, 2000, or as a result of any subsequent examination of the Insured Institution by the FDIC or the Division, or to any affiliate or related interest of, or other person or entity associated with, any such borrower ("classified borrower"), so long as such extension of credit remains classified or uncollected. This paragraph 10(b) shall not prohibit the Insured Institution for renewing all or any part of an extension of credit to a classified borrower, after collection in cash of interest due on the entire extension of credit.

   (c) The prohibitions of paragraphs 10(a) and 10(b) shall not apply to any extension of credit to a charged-off or classified borrower, if:

       (i) the Insured Institution's failure to extend further credit to a charged-off or classified borrower would be substantially detrimental to the best interests of the Insured Institution;

       (ii) the extension of credit fully complies with the requirements of the Insured Institution's written lending and collection policies and procedures which have been revised, adopted, and implemented pursuant to paragraph 12 of this ORDER;

       (iii) any extension of credit to a charged-off borrower in connection with any real estate-related financial transaction, as defined in §323.2(i), regardless of amount, is supported by a current appraisal of worth which at a minimum complies in all respects with the requirements of Part 323 of the FDIC's Rules and Regulations, 12 C.F.R. Part 323;

       (iv) a comparison with the written program adopted pursuant to paragraph 11 of this ORDER shows that the Insured Institution's formal program to eliminate the basis of criticism of said problem asset is not compromised; and

       (v) prior to extending any credit to a charged-off borrower, or a classified borrower whose outstanding loans or other extensions of credit exceed $100,000 in the aggregate, a majority of the Insured Institution's full board of directors approves the extension of credit and certifies, in writing, the specific reasons why failure to so act would be substantially detrimental to the best interests of the Insured Institution. A copy of the board's certification shall be maintained in the credit file of the charged-off or classified borrower, and shall also be submitted promptly to the Regional Director and the Commissioner.

   [.11] .11 (a) Within 30 days from the effective date of this ORDER, the board of directors of the Insured Institution shall adopt and implement a written program with regard to each asset equal to or in excess of $100,000 criticized by the FDIC and the Division as a result of their joint examination of the Insured Institution as of March 31, 2000, so as to eliminate the basis of criticism of each such asset. This program shall include, at a minimum, an assessment of the status of each criticized asset, the proposed action for eliminating the basis of criticism, and the time frame for its accomplishment. Once all such programs are adopted, a copy of the program for each criticized asset which
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   equals or exceeds $100,000 shall be forwarded to the Regional Director and the Commissioner. Furthermore, while this ORDER is in effect, the Insured Institution's board of directors shall, within 30 days following receipt of any Report of Examination of the Insured Institution from the FDIC or the Division, adopt and implement written programs, as specified above, for any assets criticized in said Reports, and forward copies of such programs to the Regional Director and the Commissioner. For the purposes of this ORDER, the term "criticized asset" means any asset or portion thereof (including any unfunded commitment), scheduled as "Special Mention", "Substandard", or "Doubtful" in any Report of Examination of the Insured Institution by the FDIC or the Division.

   (b) The Insured Institution's board of directors shall conduct a review of each program adopted pursuant to paragraph 11(a) of this ORDER on at least a monthly basis, to determine:

       (i) the status of each criticized asset;

       (ii) management's adherence to each written program;

       (iii) the status and effectiveness of each written program; and

       (iv) the need to revise each written program and/or take other actions.

   The board shall send quarterly progress reports on the status of each criticized asset equal to or exceeding $100,000 to the Regional Director and the Commissioner.

   [.12] .12 Within 60 days from the effective date of this ORDER, the Insured Institution's board of directors shall revise its written lending and collection policies and procedures to provide effective guidance and control over the lending function of the Insured Institution and shall submit said revised policies and procedures to the Regional Director and the Commissioner. At a minimum, said policies and procedures shall include the following:

       (a) Standards for all applications for credit which shall include, at a minimum:

         (i) financial statement requirements;

         (ii) credit analysis requirements;

         (iii) loan purpose statement requirements;

         (iv) identification of repayment sources (primary and secondary);

         (v) collateral requirements; and

         (vi) documentation requirements.

       (b) Effective loan administration, servicing and collection procedures including, at a minimum:

         (i) establishing lending limits for specific officers and loan amounts requiring board of directors approval;

         (ii) establishing appropriate control and periodic review of collateral;

         (iii) setting forth requirements for maintaining current information, including financial data, in credit files;

         (iv) establishing appraisal and inspection standards, and guidelines for performing reappraisals and reinspections which, at a minimum, comply with the requirements of Part 323 of the FDIC's Rules and Regulations, 12 C.F.R. Part 323;

         (v) standardizing follow-up procedures on maturing and delinquent loans;

         (vi) ensuring that delinquencies are accurately reported to the board of directors on a monthly basis;

         (vii) placing loans on nonaccrual status in accordance with the Instructions for Consolidated Reports of Condition and Income; and

         (viii) recognizing losses in a timely manner.

       (c) A loan review system which will effectively identify, categorize, and report problem credits to the board of directors. Such reports shall, at a minimum, include the following information:

         (i) the overall quality of the loan portfolio;

         (ii) the identification, type and amount of problem loans;

         (iii) the identification and amount of delinquent loans;

         (iv) credit and collateral documentation exceptions; and

         (v) the identification and status of violations of law or regulations.

   All references to loans in this ORDER shall be deemed to include all other forms of extensions of credit.

   Upon receipt of written approval or a written statement of nonobjection from the Regional Director, said policies and procedures shall be forthwith adopted and implemented by the Insured Institution's board of directors.

   [.13] .13 (a) Within 30 days from the effective date of this ORDER, the board of direc
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   tors of the Insured Institution shall adopt and implement an internal loan review and grading system to periodically review the Insured Institution's loan portfolio and identify and categorize problem credits ("System"). At a minimum, the System shall provide for:

       (i) identifying the overall quality of the loan portfolio;

       (ii) the identification and amount of each delinquent loan;

       (iii) an identification or grouping of loans that warrant the special attention of management;

       (iv) for each loan identified, a statement of the amount and an indication of the degree of risk that the loan will not be fully repaid according to its terms and the reason(s) why the particular loan merits special attention;

       (v) an identification of credit and collateral documentation exceptions;

       (vi) the identification and status of each violation of law, rule or regulation;

       (vii) an identification of loans not in conformance with the Insured Institution's lending policy, and exceptions to the Insured Institution's lending policy;

       (viii) an identification of insider loan transactions; and

       (ix) a mechanism for reporting periodically, but in any event no less than quarterly, to the board of directors on the status of each loan identified and the action(s) taken by operating management.

   (b) A copy of the reports submitted to the board, as well as documentation of the action taken by the Insured Institution to collect or strengthen assets identified as problem credits, shall be kept with the minutes of the board of directors.

   [.14] .14 Within 60 days from the effective date of this ORDER the Insured Institution's board of directors shall establish and appoint a loan committee to review and approve in advance all extensions of credit and/or renewals that, when aggregated with all other extensions of credit to that borrower, either directly or indirectly, exceed or would exceed $250,000. The review shall include financial, income, and cash flow information, collateral values and lien information, repayment terms, past performance by the borrower, the purpose of the extension, and whether the extension complies with the Insured Institution's loan policy and applicable laws, rules, and regulations. The loan committee shall meet at least monthly and shall maintain written minutes which document its reviews, conclusions, approvals, denials and recommendations. At least monthly, the loan committee shall submit its written minutes to the board of directors. At least three of the members of the loan committee shall be directors who are not now, and never have been, involved in the daily operations of the Insured Institution ("Outside Directors").

   [.15] .15 Within 60 days from the effective date of this ORDER, the Insured Institution shall eliminate and/or correct all violations of law and regulations as described in the joint Report of Examination of the Insured Institution by the FDIC and the Division as of March 31, 2000.

   [.16] .16 Within 60 days from the effective date of this ORDER, the Insured Institution shall adopt and implement a written liquidity and funds management policy. Such policy shall include the establishment of acceptable ranges of ratios in the following areas: volatile liability dependence, total loans to total deposits and temporary investments to volatile liabilities. In addition, the liquidity policy shall incorporate a funds management program which designates acceptable levels for: volatile liabilities, including borrowings; asset mix, including temporary funds and investments, long-term investment securities and classes of obligors, and loans to deposits; and rate-sensitive assets as a percent of rate-sensitive liabilities. Such policy and its implementation shall be in a form and manner acceptable to the Regional Director and the Commissioner as determined at subsequent examinations and/or visitations.

   [.17] .17 Within 90 days from the effective date of this ORDER, the Insured Institution's board of directors shall revise, adopt and implement written policies and procedures to provide effective guidance and control over the internal routine and controls of the Insured Institution, in accordance with safe and sound banking practices. Among other provisions, the revised policies and procedures shall specifically provide for correction of all internal routine and controls deficiencies scheduled by the FDIC and the Division as a result of their joint examination of the Insured Institution as of March 31, 2000. Such policy and its implementa
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   tion shall be in a form and manner acceptable to the Regional Director and the Commissioner as determined at subsequent examinations and/or visitations.

   [.18] .18 The Insured Institution shall not declare or pay dividends in any amount except as follows:

       (a) That such declarations and payments are made in accordance with applicable State and Federal laws and regulations;

       (b) That after payment of such dividends, the Insured Institution's total risk-based capital ratio, Tier 1 risk-based capital ratio and leverage ratio meet or exceed the levels specified for it to be deemed well capitalized, within the meaning of Part 325 of the FDIC's Rules and Regulations, section 325.103(b)(1);

       (c) That such declaration and payment of dividends shall be approved in advance by the board of directors of the Insured Institution; and

       (d) That the Insured Institution provide prior notice, in writing, to the Regional Director and the Commissioner of its intention to declare or pay dividends.

   [.19] .19 Within 60 days from the effective date of this ORDER, the Insured Institution shall adopt and implement a policy for accounting with respect to its holding company which will address the deficiencies set forth in the Report of Examination as of March 31, 2000. At a minimum, the policy shall provide for the use of separate books and ledgers for the Insured Institution's and the holding company's transactions. The policy shall also include procedures to ensure that generally accepted accounting principles are followed, and that the deficiencies set forth in the Report of Examination as of March 31, 2000 do not recur.

   20. Within 15 days of the effective date of this ORDER, the Insured Institution shall provide the board of directors of its holding company with a copy of this ORDER.

   [.20] .21 The Insured Institution's board of directors shall appoint a committee composed of at least three directors who are not now and have never been involved in the daily operations of the Insured Institution, and whose composition is acceptable to the Regional Director and the Commissioner (the "Compliance Committee"), to monitor the Insured Institution's compliance with this ORDER. Within 30 days from the effective date of this ORDER, and at monthly intervals thereafter, such Compliance Committee shall prepare and present to the Insured Institution's board of directors a written report of its findings, detailing the form, content, and manner of any action taken to secure compliance with this ORDER and the results thereof, and any recommendations with respect to such compliance. Such progress reports shall be included in the minutes of the meeting of the Insured Institution's board of directors.

   22. By the 30th day after the end of the calendar quarter following the effective date of this ORDER, and by the 15th day after the end of every calendar quarter thereafter, the Insured Institution shall furnish written progress reports to the Regional Director and the Commissioner detailing the form, content, and manner of any actions taken to secure compliance with this ORDER, and the results thereof.

   The effective date of this ORDER shall be (10) days from the date of its issuance.

   The provisions of this ORDER shall be binding upon the Insured Institution, its directors, officers, employees, and other institution-affiliated parties.

   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.

   Pursuant to delegated authority.

   Dated: November 17, 2000

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