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FDIC Enforcement Decisions and Orders



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   [12,056] In the Matter of The Commercial Bank of Volusia County, Ormond Beach, Florida, Docket No. 03-050b (6-5-03).

   A cease and desist order was issued, based on findings by the FDIC that it had reason to believe that respondent was engaged in unsafe and unsound practices. (This order was terminated by order of the FDIC dated 3-15-05; see ¶16,413.)

   [.1] Management—Qualifications Specified

   [.2] Board of Directors—Increase Participation in Bank Affairs Required

   [.3] Capital—Tier I Capital Increase/Maintain

   [.4] Dividends—Dividends Restricted

   [.5] Assets—Charge-off or Collection

   [.6] Assets—Adversely Classified Assets—Reduction required

   [.7] Assets—Adversely Classified Assets—Written plan required

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

   [.9] Loans—Special Mention

   [.10] Loan Policy—Internal Review and Grading—Minimum Requirements Specified

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

   [.12] Loan Loss Reserve—Establishment of or Increase Required

   [.13] Profit Plan and Budget—Preparation of Plan Required

   [.14] Strategic Plan—Preparation of Required

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

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

   [.17] Conflicts of Interest—Written Policy Required
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   [.18] Shareholders—Disclosure of Cease and Desist Order Required

   [.19] Progress Report—Written Report Required

In the Matter of
THE COMMERCIAL BANK OF VOLUSIA COUNTY
ORMOND BEACH, FLORIDA
(Insured State Nonmember Bank)
ORDER TO CEASE AND DESIST

FDIC-03-050b

   The Commercial Bank of Volusia County, Ormond Beach, Florida ("Bank"), having been advised of its right to a Notice of Charges and of Hearing detailing the unsafe or unsound banking practices and violations of applicable laws and/or regulations alleged to have been committed by the Bank 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") and with a representative of the Florida Office of Financial Institutions and Securities Regulation ("OFISR"), dated May 16, 2003. The OFISR may issue an order to cease and desist pursuant to Fla. Stat. Ch. 655, §655.033. Solely for the purpose of this proceeding and without admitting or denying any of the charges of unsafe or unsound banking practices and violations of laws and/or regulations, the Bank has consented to the issuance of an ORDER TO CEASE AND DESIST ("ORDER") by the FDIC and the OFISR.

   The FDIC and the OFISR considered the matter and determined that there is reason to believe that the Bank had engaged in unsafe or unsound banking practices and had committed violations of laws and regulations. The FDIC and the OFISR, therefore, accepted the Consent Agreement and issued the following:

ORDER TO CEASE AND DESIST

   It is HEREBY ORDERED, that the Bank, its 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:

       1. Operating with inadequate management;

       2. Operating with inadequate equity capital in relation to the volume and quality of assets held by the Bank;

       3. Operating with a large volume of poor quality loans;

       4. Operating with an inadequate allowance for loan and lease losses;

       5. Following hazardous lending and lax collection practices;

       6. Following hazardous practices with regards to management of interest rate risk;

       7. Operating in such a manner as to produce operating losses; and

       8. Operating in violation of laws and/or regulations as more fully described on pages 9–19 of the FDIC Report of Examination dated October 21, 2002 (the "Report").

   IT IS HEREBY ORDERED, that the Bank, its institution-affiliated parties, and its successors and assigns take affirmative action as follows:

   [.1] 1. MANAGEMENT

   Within 90 days of the effective date of this ORDER, the Bank shall have and retain qualified management.

   (a) Each member of management shall have qualifications and experience commensurate with his or her duties and responsibilities at the Bank. At a minimum, management shall include the following:

       (1) a chief executive officer with proven ability in managing a bank of comparable size and in effectively implementing lending, investment and operating policies in accordance with sound banking practices;

       (2) a senior lending officer with significant appropriate lending, collection, and loan supervision experience, and experience in upgrading a low quality loan portfolio; and

       (3) a chief operations officer with significant appropriate experience in managing the operations of a bank of similar size and complexity in accordance with sound banking practices.

   (b) The qualifications of management shall be assessed on its ability to:
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       (1) comply with the requirements of this ORDER;

       (2) operate the Bank in a safe and sound manner;

       (3) comply with applicable laws and regulations; and

       (4) restore all aspects of the Bank to a safe and sound condition, including asset quality, capital adequacy, earnings, sensitivity to interest rate risk, management effectiveness, and risk management.

   (c) During the life of this ORDER, the Bank shall notify the Regional Director of the FDIC's Atlanta Regional Office ("Regional Director") and the Director of OFISR ("Director") (collectively, "Supervisory Authorities") in writing when it proposes to add any individual to the Bank's board of directors ("Board") or employ any individual as a senior executive officer, as that term is defined in Part 303 of the FDIC's Rules and Regulations, 12 C.F.R. §303.102. The notification should include a description of the background and experience of the individual or individuals to be added or employed and must be received at least 30 days before such addition or employment is intended to become effective. If the Regional Director issues a notice of disapproval pursuant to section 32 of the Act, 12 U.S.C. §1831i, with respect to any proposed individual, then such individual may not be added or employed by the Bank.

   (d) To facilitate compliance with Paragraph 1 (a), the Board shall, in no more than 30 days from the effective date of this ORDER, develop and approve a written analysis and assessment of the Bank's management and staffing needs ("Management Plan"), which shall include, at a minimum:

       (1) identification of both the type and number of officer positions needed to manage and supervise properly the affairs of the Bank;

       (2) identification and establishment of such Bank committees as are needed to provide guidance and oversight to active management;

       (3) evaluation of each Bank officer, and in particular the chief executive officer, chief lending officer, and the chief operating officer 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

       (4) a plan of action to recruit and hire any additional or replacement personnel with the requisite ability, experience and other qualifications, which the Board determines are necessary to fill Bank officer or staff member positions consistent with the Management Plan as provided in this paragraph and other parts of this ORDER.

   The written Management Plan and any subsequent modification thereto shall be submitted to the Supervisory Authorities for review and comment. No more than 30 days from the receipt of any comment from the Supervisory Authorities, and after consideration of such comment, the Board shall approve the written Management Plan and/or any subsequent modification. Such Management Plan and its implementation shall be satisfactory to the Supervisory Authorities as determined at their initial review and at subsequent examinations and/or visitations.

       (e) (1) The written Management Plan shall also include the requirement that the Board, or a committee thereof consisting of not less than a majority of the individuals who are independent with respect to the Bank, provide supervision sufficient to ensure that the Bank complies with the provisions of this ORDER.

       (2) For purposes of this ORDER, an individual who is "independent with respect to the Bank" shall be any individual (A) who is not an officer of the Bank or any of its affiliated organizations and who does not own more than 5 percent of the outstanding shares of the Bank, (B) who is not related by blood, marriage or common financial interest to any officer of the Bank or to any stockholder owning more than 5 percent of the Bank's outstanding shares, and (C) who is not indebted to the Bank, directly or indirectly (including indebtedness of any entity in which the individual has a substantial financial interest), in an amount exceeding 5 percent of the Bank's Tier 1 capital and allowance for loan and lease losses.


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   [.2] 2. BOARD OF DIRECTORS

   (a) From the effective date of this ORDER, the Board shall increase its participation in the affairs of the Bank, assuming full responsibility for the approval of sound policies and objectives and for the supervision of all of the Bank's activities, consistent with the role and expertise commonly expected for directors of banks of comparable size. This participation shall include meetings to be held no less frequently than monthly. The Board shall prepare in advance and follow a detailed written agenda at each meeting, which shall, at a minimum, include the review and approval of: the actions of any committees; reports of income and expenses; new, overdue, renewal, insider, charged-off, and recovered loans; investment activity; operating policies; and individual committee actions. Detailed written minutes of all Board meetings shall be maintained and recorded on a timely basis fully documenting the Board's review, discussion and approval of all agenda items and any other matters discussed at the meeting and shall include the names of any dissenting directors on any matter.

   (b) Within 30 days from the effective date of this ORDER, the Board shall develop and adopt a written educational program for each member of the Board. The educational program shall include, at a minimum:

       (1) specific training in the areas of lending, operations, and compliance with all applicable Federal and Florida laws, rules and regulations or statements of policy, including, but not limited to laws, rules and regulations or statements of policy pertaining to restrictions on insider transactions;

       (2) specific training in the duties and responsibilities of the Board in connection with the safe and sound operation of the Bank; and

       (3) provision for periodic training.

   This educational program shall be submitted to the Supervisory Authorities for review within 30 days from the effective date of this ORDER. The educational program shall be satisfactory to the Supervisory Authorities at their initial review and as determined at subsequent examinations and/or visitations. The Board shall document the training activities in the minutes of the next Board meeting following completion of the training.

   (c) Within 30 days of the effective date of this ORDER, the Bank shall designate a directors' committee to review and approve loans, with such committee being structured so that a majority of its members are persons who are not actively involved in the Bank's lending activities.

   [.3] 3. CAPITAL

   (a) By July 15, 2003, the Bank shall increase Tier 1 capital by not less than One Million Dollars ($1,000,000.00) and shall have Tier 1 capital in such an amount as to equal or exceed 7.5 percent of the Bank's total assets. Thereafter, during the life of this ORDER, the Bank shall maintain Tier 1 capital in such an amount as to equal or exceed 7.5 percent of the Bank's total assets.

   (b) By June 30, 2003, the Bank shall develop and adopt a plan to have risk-based capital, as described in the FDIC Statement of Policy on Risk-Based Capital contained in Appendix A to Part 325 of the FDIC's Rules and Regulations, 12 C.F.R. Part 325, Appendix A, in such an amount as to equal or exceed 10 percent. The plan shall be in a form and manner acceptable to the Supervisory Authorities as determined at subsequent examinations and/or visitations.

   (c) The level of Tier 1 capital to be maintained during the life of this ORDER pursuant to subparagraph 3(a) shall be in addition to a fully funded allowance for loan and lease losses, the adequacy of which shall be satisfactory to the Supervisory Authorities as determined at subsequent examinations and/or visitations.

   (d) Any increase in Tier 1 capital necessary to meet the requirements of Paragraph 3 of this ORDER may be accomplished by the following

       (1) sale of common stock;

       (2) direct contribution of cash by the Board, shareholders, and/or the parent holding company; or

       (3) other means acceptable to the Supervisory Authorities.

   Any increase in Tier 1 capital necessary to meet the requirements of Paragraph 3 of this ORDER may NOT be accomplished through a deduction from the Bank's allowance for loan and lease losses.

   (e) For the purposes of this ORDER, the terms "Tier 1 capital" and "total assets" shall have the meanings ascribed to them in Part
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   325 of the FDIC's Rules and Regulations, 12 C.F.R. §§ 325.2(t) and 325.2(v).

   (f) If all or part of any necessary increase in Tier 1 capital required by this Paragraph is accomplished by the sale of new securities, the Board shall forthwith take all necessary steps to adopt and implement a plan for the sale of such additional securities, including the voting of any shares owned or proxies held or 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 disclosures necessary to comply with any applicable 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, 550 17th Street, N.W., Washington, D.C. 20429, and the OFISR for review. Any changes requested to be made in the plan or materials shall be made prior to their dissemination.

   (g) In complying with the provisions of Paragraph 3 of this ORDER, the Bank shall provide to any subscriber and/or purchaser of the Bank's securities, a written notice of any planned or existing development or other changes which are 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 10 days from the date such material development or change was planned or occurred, whichever is earlier, and shall be furnished to every subscriber and/or purchaser of the Bank's securities who received or was tendered the information contained in the Bank's original offering materials.

   [.4] 4. DIVIDENDS

   The Bank shall not pay cash dividends without the prior written consent of the Supervisory Authorities.

   [.5] 5. CHARGE-OFF

   Within 10 days from the effective date of this ORDER, the Bank shall eliminate from its books, by charge-off or collection, all assets or portions of assets classified "Loss" in the Report not previously collected or charged-off. Elimination of these assets through proceeds of other loans made by the Bank is not considered collection for purposes of this paragraph.

   [.6] 6. REDUCTION OF CLASSIFIED ASSETS

   (a) By September 30, 2003, the Bank shall have reduced the assets classified "Substandard" in the Report to not more than $1,750,000.

   (b) By December 31, 2003, the Bank shall have reduced the assets classified "Substandard" in the Report to not more than $1,300,000.

   (c) By March 31, 2004, the Bank shall have reduced the assets classified, "Substandard" in the Report to not more than $750,000.

   (d) The requirements of subparagraphs 6(a), 6(b), and 6(c) of this ORDER are not to be construed as standards for future operations and, in addition to the foregoing; the Bank shall eventually reduce the total of all adversely classified assets. Reduction of these assets through proceeds of other loans made by the Bank is not considered collection for the purpose of this paragraph. As used in subparagraphs 6(a), 6(b), and 6(c) the word "reduce" means:

       (1) to collect;

       (2) to charge-off; or

       (3) to sufficiently improve the quality of assets adversely classified to warrant removing any adverse classification, as determined by the Supervisory Authorities.

   [.7] 7. PLANS FOR REDUCING/IMPROVING CLASSIFIED ASSETS

   Within 60 days of the effective date of this ORDER, the Bank shall submit to the Supervisory Authorities a written plan to effect the reduction and/or improvement of any lines of credit adversely classified by the Supervisory Authorities as of October 21, 2002, and which aggregate $100,000 or more as of that date. Such plan shall thereafter be monitored and progress reports thereon resubmitted by the Bank at 90-day
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   intervals concurrently with the other reporting requirements set forth in Paragraph 18 of this ORDER.

   [.8] 8. ADDITIONAL CREDIT

   (a) Beginning with the effective date of this ORDER, the Bank shall not extend, directly or indirectly, any additional credit to, or for the benefit of, any borrower who has a loan or other extension of credit from the Bank that has been charged off or classified, in whole or in part, "Loss" or "Doubtful" and is uncollected. The requirements of this paragraph shall not prohibit the Bank from renewing (after collection in cash of interest due from the borrower) any credit already extended to any borrower.

   (b) Additionally, during the life of this ORDER, the Bank shall not extend, directly or indirectly, any additional credit to, or for the benefit of, any borrower who has a loan or other extension of credit from the Bank that has been classified, in whole or part, "Substandard" and is uncollected.

   (c) Paragraph 8(b) shall not apply if the Bank's failure to extend further credit to a particular borrower would be detrimental to the best interests of the Bank. Prior to the extending of any additional credit pursuant to this paragraph, either in the form of a renewal, extension, or further advance of funds, such additional credit shall be approved by a majority of the Board or a designated committee thereof, who shall certify in writing as follows:

       (1) why the failure of the Bank to extend such credit would be detrimental to the best interests of the Bank;

       (2) that the Bank's position would be improved thereby; and

       (3) how the Bank's position would be improved.

   The signed certification shall be made a part of the minutes of the Board or its designated committee and a copy of the signed certification shall be retained in the borrower's credit file.

   [.9] 9. SPECIAL MENTION

   Within 60 days from the effective date of this ORDER, the Bank shall correct the cited deficiencies in the loans listed for "Special Mention" on pages 35 and 36 of the Report.

   [.10] 10. INTERNAL LOAN REVIEW AND GRADING SYSTEM

   (a) Within 60 days from the effective date of this ORDER, the Bank shall develop and adopt an internal loan review and grading system to provide for the periodic review of the Bank's loan portfolio in order to identify and categorize the Bank's loans, and other extensions of credit carried on the Bank's books as loans, on the basis of credit quality. The Bank shall also within 60 days from the effective date of this ORDER, submit the written internal loan review and grading system to the Supervisory Authorities for review. Such system and its implementation shall be satisfactory to the Supervisory Authorities as determined at their initial review and at subsequent examinations and/or visitations. At a minimum, the grading system shall require the following:

       (1) specification of standards and criteria for assessing the credit quality of the Bank's loans;

       (2) application of loan grading standards and criteria to the Bank's loan portfolio;

       (3) categorization of the Bank's loans into groupings based on the varying degrees of credit and other risks which may be presented under the applicable grading standards and criteria, but in no case, will a loan be assigned a rating higher than that assigned by examiners at the last examination of the Bank without prior written notification to the Supervisory Authorities;

       (4) assessment of the likelihood that each loan exhibiting credit and other risks will not be repaid according to its terms and conditions;

       (5) identification of any loan that is not in conformance with the Bank's loan policy;

       (6) identification of any loan which presents any unsafe or unsound banking practice or condition or is otherwise in violation of applicable Federal and Florida laws, regulations, or statements of policy; and

       (7) preparation of a written report to be made to the Bank's Board and Audit Committee, not less than quarterly after the effective date of this ORDER. The report shall identify the status of those loans which exhibit credit and other risks under the applicable grading standards/criteria and the prospects for full collection and/or
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       strengthening of the quality of any such loans.

   (b) The Bank shall also hire, appoint, or contract with a qualified individual to administer the internal loan review and grading system. The qualifications of this individual shall be assessed on the following:

       (1) training in loan review/examination procedure;

       (2) knowledge of loan documentation requirements;

       (3) loan review/examination experience;

       (4) ability to comply with the requirements of this ORDER and the Bank's written loan and loan review policies; and

       (5) knowledge of applicable laws and regulations and sound lending/banking procedures.

   [.11] 11. LENDING POLICIES

   Within 60 days from the effective date of this ORDER, the Bank shall revise, adopt, and implement a written lending and collection policy to provide effective guidance and control over the Bank's lending function, which policy shall include, at a minimum, revisions to address all items of criticism enumerated on pages 6 and 7 of the Report, including, but not limited to, those criticisms pertaining to overdraft policies and procedures and supervision and control of insider transactions. Such policy and its implementation shall be in a form and manner acceptable to the Supervisory Authorities as determined at subsequent examinations and/or visitations.

   [.12] 12. ESTABLISH/MAINTAIN ALLOWANCE FOR LOAN/LEASE LOSSES

   Within 30 days from the effective date of this ORDER, the Board shall review the adequacy of the allowance for loan and lease losses ("allowance") and establish a comprehensive policy for determining the adequacy of the allowance for loan and lease losses. For the purpose of this determination, the adequacy of the allowance shall be determined after the charge-off of all loans or other items classified "Loss". The policy shall provide for a review of the allowance at least once each calendar quarter. Said review should be completed at least ten (10) days prior to the end of each quarter, in order that the findings of the Board with respect to the allowance for loan and lease losses may be properly reported in the quarterly Reports of Condition and Income. The review should focus on the results of the Bank's internal loan review, loan and lease loss experience, trends of delinquent and non-accrual loans, an estimate of potential loss exposure of significant credits, concentrations of credit, and present and prospective economic conditions. A deficiency in the allowance shall be remedied in the calendar quarter it is discovered, prior to submitting the Report of Condition, by a charge to current operating earnings. The minutes of the Board meeting at which such review is undertaken shall indicate the results of the review. The Bank's policy for determining the adequacy of the Bank's allowance and its implementation shall be satisfactory to the Supervisory Authorities as determined at subsequent examinations and/or visitations.

   [.13] 13. BUDGET/PROFIT PLAN

   (a) Within 60 days from the effective date of this ORDER, the Bank shall formulate and implement a written plan to improve earnings. This plan and any subsequent modification thereto shall be submitted to the Supervisory Authorities for review and comment and shall address, at a minimum, the following:

       (1) goals and strategies for improving and sustaining the earnings of the Bank;

       (2) the major areas in, and means by which, the Board will seek to improve the Bank's operating performance;

       (3) realistic and comprehensive budgets;

       (4) a budget review process to monitor the income and expenses of the Bank to compare actual performance with budgetary projections;

       (5) the operating assumptions that form the basis for, and adequately support, major projected income and expense components; and

       (6) coordination of the Bank's loan, investment, and operating policies, and budget and profit planning, with the funds management policy.

   (b) Following the end of each calendar quarter, the Board shall evaluate the Bank's actual performance in relation to the plan required by this paragraph and shall record
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   the results of the evaluation, and any actions taken by the Bank, in the minutes of the Board meeting at which such evaluation is undertaken.

   (c) Thereafter, the Bank shall formulate such a plan and budget by November 30 of each subsequent year. These plans and budgets shall be submitted to the Supervisory Authorities for review and comment by December 15 of each subsequent year.

   [.14] 14. STRATEGIC PLAN

   Within 90 days from the effective date of this ORDER, the Bank shall prepare and submit to the Supervisory Authorities its written strategic plan consisting of long-term goals designed to improve the condition of the Bank and its viability and strategies for achieving those goals. The plan shall be in a form and manner acceptable to the Supervisory Authorities as determined at subsequent examinations and/or visitations, but at a minimum shall cover three years and provide specific objectives for asset growth, market focus, earnings projections, capital needs, and liquidity positions.

   [.15] 15. FUNDS MANAGEMENT

   Within 60 days of the effective date of this ORDER, the Board shall develop and implement a written policy for managing interest rate risk in a manner that is appropriate to the size of the Bank and the complexity of its assets. The policy shall comply with the Joint Agency Policy Statement on Interest Rate Risk, shall be consistent with the comments and recommendations detailed in the Report and shall include, at a minimum, the means by which the interest rate risk position will be monitored, the establishment of risk parameters, and provisions for periodic reporting to management and the Board regarding interest rate risk with adequate information provided to assess the level of risk. The Bank shall also within 60 days of the effective date of this Order, submit the policy to the Supervisory Authorities for review and comment. Such policy and its implementation shall be satisfactory to the Supervisory Authorities as determined during their initial review and at subsequent examinations and/or visitations.

   [.16] 16. VIOLATIONS OF LAW

   Within 30 days from the effective date of this ORDER, the Bank shall eliminate and/or correct all violations of law identified on pages 9 through 19 of the Report. Provided, however, that any loans violating the lending limits contained in Fla. Stat. Ch. 658, §658.48(1)(a), shall be reduced to the lending limits required by Florida law within 10 days from the effective date of this ORDER. Additionally, the Bank shall take all necessary steps to ensure future compliance with all applicable Federal and Florida laws, regulations and statements of policy.

   [.17] 17. CONFLICTS OF INTEREST

   Within 30 days from the effective date of this ORDER, the Bank shall develop, adopt, and implement a written policy designed to bring any potential conflicts of interest to the attention of the Board when it is considering direct or indirect loans or other transactions where officers, directors or principal shareholders of the Bank ("Insiders") are involved. Such policy shall, at a minimum, ensure that the Board has been apprised of any potential conflict prior to making a decision, or acting specifically on any loan or other transaction directly or indirectly involving Insiders and/or their business associates. The results of any deliberations by the Board regarding potential conflicts shall be reflected in the minutes of its meetings.

   [.18] 18. NOTICE TO SHAREHOLDERS

   Following the effective date of this ORDER, the Bank shall send to its shareholders or otherwise furnish a description of this ORDER in conjunction with the Bank's next shareholder communication and also in conjunction with its notice or proxy statement preceding the Bank's next shareholder meeting. The description shall fully describe the ORDER in all material respects. The description and any accompanying communication, statement, or notice shall be sent to the FDIC, Registration and Disclosure Section, 550 17th Street, N.W., Washington, D.C. 20429, at least 15 days prior to dissemination to shareholders. Any changes requested to be made by the FDIC shall be made prior to dissemination of the description, communication, notice, or statement.

   [.19] 19. PROGRESS REPORTS

   Within 30 days of the end of the first quarter following the effective date of this ORDER, and within 30 days of the end of each quarter thereafter, the Bank shall furnish written progress reports to the Supervisory Authorities detailing the form and manner of any actions taken to secure compliance with this ORDER
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   and the results thereof. Such reports shall include a copy of the Bank's Report of Condition and the Bank's Report of Income. Such reports may be discontinued when the corrections required by this ORDER have been accomplished and the Supervisory Authorities have released the Bank in writing from making further reports.

   This ORDER shall become effective 10 days from the date of its issuance.

   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 Supervisory Authorities.

   Pursuant to delegated authority.

   Dated this 5th day of June, 2003

   The Director, Office of Financial Institutions and Securities Regulation having duly approved the foregoing ORDER, and the Bank, through its Board, having agreed that the issuance of the said ORDER by the FDIC shall be binding as between the Bank and the Office of Financial Institutions and Securities Regulation to the same degree and legal effect that such ORDER would be binding upon the Bank if the Office of Financial Institutions and Securities Regulation had issued a separate ORDER that included and incorporated all of the provisions of the foregoing ORDER pursuant to Fla. Stat. Ch. 655, §655.033.



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