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FDIC Enforcement Decisions and Orders



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   [12,189] In the Matter of First Security Bank & Trust Company, Norton, Kansas, Docket No. 04-047b (4-19-04).

   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 4-14-05; see ¶16,416.)

   [.1] Management—Qualifications Specified

   [.2] Capital—Tier 1 Capital Increase/Maintain

   [.3] Dividends—Dividends Restricted

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

   [.5] Assets—Charge-off or Collection
{{6-30-05 p.C-6062}

   [.6] Loans—Risk Position—Reduction of Adversely Classified Lines of Credit Required

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

   [.8] Loan Committee—Duties Specified

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

   [.10] Technical Exceptions—Correction of Technical Exceptions Required

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

   [.12] Profit Plan—Preparation of Plan Required

   [.13] Audit—Program Required

   [.14] Loans—Review Program

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

   [.16] Bank Secrecy Act—Compliance

   [.17] Shareholders—Disclosure of Cease and Desist Order Required

   [.18] Board of Directors—Committee to Review Compliance Program Required

   [.19] Progress Reports—Written Report Required

In the Matter of
FIRST SECURITY BANK & TRUST COMPANY
NORTON, KANSAS
(Insured State Nonmember Bank)
ORDER TO CEASE AND DESIST

FDIC-04-047b

   First Security Bank & Trust Company, Norton, Kansas ("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 law and regulations alleged to have been committed by the Bank, as well as of its right to a hearing on the charges under section 8(b) of the Federal Deposit Insurance Act ("Act"), 12 U.S.C. §1818(b), and having waived those rights, entered into a STIPULATION AND CONSENT TO THE ISSUANCE OF AN ORDER TO CEASE AND DESIST ("CONSENT AGREEMENT") dated April 8, 2004, with counsel for the Federal Deposit Insurance Corporation ("FDIC"), whereby, solely for the purpose of this proceeding and without admitting or denying any charges of unsafe or unsound banking practices and violations of law and regulations, 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 and unsound banking practices and violations of law and regulations. The FDIC, 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 or unsound banking practices and violations of law and regulations:

       A. Operating with management whose policies and practices are detrimental to the Bank and jeopardize the safety of its deposits.

       B. Operating with a board of directors that has failed to provide adequate supervision over and direction to the management of the Bank.

       C. Operating with an inadequate level of capital protection for the kind and quality of assets held.

       D. Operating with an inadequate allowance for loans and lease losses for the volume, kind, and quality of loans and leases held.

       E. Engaging in hazardous lending and lax collection practices, including, but not limited to:
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         (1) the failure to obtain proper loan documentation;

         (2) the failure to obtain adequate collateral;

         (3) the failure to establish and monitor collateral margins of secured borrowers;

         (4) the failure to establish and enforce adequate loan repayment programs;

         (5) the failure to obtain current and complete financial information;

         (6) the extension of credit with inadequate diversification of risk; and

         (7) other poor credit administration practices.

       F. Operating with an excessive level of adversely classified assets.

       G. Operating with an inadequate loan policy.

       H. Operating with earnings insufficient to absorb loan losses and provide adequate capital augmentation.

       I. Operating with an inadequate funds management policy.

       J. Operating with an inadequate audit program.

       K. Operating with an inadequate Bank Secrecy Act compliance program.

       L. Violating laws and regulations, including:

         (1) the requirements of Part 103 of the Treasury Department's Financial Recordkeeping and Reporting of Currency and Foreign Transactions Regulation, 31 C.F.R. Part 103 §§18-38; and

         (2) the employee training and reporting requirements for bank security, stated in section 326.3 and 326.4 of the FDIC Rules and Regulations, 12 C.F.R. §§ 326.3 and 326.4;

         (3) the requirements for a Bank Secrecy Act compliance program, including testing for compliance with the Act and employee training, stated in section 326.8 of the FDIC Rules and Regulations, 12 C.F.R. §326.8; and

         (4) the audit requirements of section 9-1116 of the Kansas Statutes Annotated.

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

   [.1] 1. MANAGEMENT. For purposes of this Order, the qualifications of management shall be assessed on its ability to comply with the requirements of this ORDER, operate the Bank in a safe and sound manner, comply with applicable laws and regulations, and restore all aspects of the Bank to a safe and sound condition, including asset quality, capital adequacy, earnings, management effectiveness, and sensitivity to market risk. Furthermore, "senior executive officer" shall be defined as in section 32 of the Act, 12 U.S.C. §1831(i), and section 303.101(b) of the FDIC Rules and Regulations, 12 C.F.R. §303.101(b). Each member of Bank management shall have qualifications and experience commensurate with his or her duties and responsibilities at the Bank.

       (a) During the life of this ORDER, the Bank shall notify the Regional Director and the State Bank Commissioner, in writing, of the resignation or termination of any of the Bank's directors or senior executive officers.

       (b) Prior to the addition of any individual to the board of directors or the employment of any individual as a senior executive officer, the Bank shall comply with the requirements of section 32, supra, and Subpart F of Part 303 of the FDIC Rules and Regulations, 12 C.F.R. §§ 303.100-303.103.

       (c) Within 30 days from the effective date of this Order, the Bank shall retain a bank consultant acceptable to the Regional Director and the State Bank Commissioner, who, within 90 days from the effective date of this ORDER, shall make an analysis and assessment of the Bank's management and staffing needs and shall develop and complete a plan ("Management Plan") for the purpose of providing qualified management for the Bank.

       (d) The Management Plan shall include, at a minimum:

         (i) identification of both the type and number of officer positions needed to properly manage and supervise 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 all Bank officers and staff members to determine whether these individuals possess the ability, experience and other qualifications required


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         to perform present and anticipated duties, including adherence to the Bank's established policies and practices, and restoration and maintenance of the Bank in a safe and sound condition; and

         (iv) a plan to recruit and hire any additional or replacement personnel with the requisite ability, experience and other qualifications to fill those officer or staff member positions identified previously in this ORDER.

       (e) Upon completion of the Management Plan, it shall be submitted to the Regional Director and the State Bank Commissioner for review and comment. Within 30 days of the receipt of any comments from the Regional Director, and after due consideration of any recommended changes, the board of directors of the Bank shall approve the Management Plan, which approval shall be recorded in the minutes of the board of directors meeting. Any subsequent modification of the Management Plan shall require submission to the Regional Director for review and comment prior to approval by the Bank.

       (f) Thereafter, the Bank, its directors, officers and employees shall implement and follow the approved Management Plan.

       (g) Within 60 days from the board of directors' approval of the Management Plan, the Bank shall have and retain qualified management, who shall be provided the necessary written authority to implement the provisions of this ORDER.

   [.2] 2. CAPITAL ADEQUACY. For purposes of this ORDER, "capital ratio" means the level of Tier 1 capital as a percentage of total assets. Tier 1 capital and total assets shall be calculated in accordance with Part 325 of the FDIC Rules and Regulations ("Part 325"), 12 C.F.R. Part 325.

       (a) Within 30 days from the date of this ORDER, the Bank shall submit a written plan to the Regional Director and the State Bank Commissioner describing the means and timing by which the Bank shall increase the capital ratio to, and thereafter maintain it at, no less than 7 percent ("Capital Plan"). The Capital Plan shall be submitted to the Regional Director and the State Bank Commissioner for review and comment. Within 30 days from the receipt of any comments from the Regional Director, and after due consideration of any recommended changes, the board of directors shall approve the Capital Plan, which approval shall be recorded in the minutes of the board of directors meeting. Thereafter, the Bank shall implement and follow the Capital Plan.

       (b) Any increases in Tier 1 capital may be accomplished by the following:

         (i) the sale of common stock and non-cumulative perpetual preferred stock;

         (ii) the elimination of all or part of the assets classified "Loss" as of December 8, 2003, without incurring loss or liability to the Bank, provided any such collection on a partially charged-off asset shall first be applied to that portion of the asset which was not charged off pursuant to this ORDER;

         (iii) the collection in cash of assets previously charged off;

         (iv) the direct contribution of cash by the directors and/or the shareholders of the Bank;

         (v) any other means acceptable to the Regional Director; and

         (vi) any combination of the above.

       (c) If all or part of the increase in capital required by this paragraph is to be accomplished by the sale of new securities, the board of directors of the Bank shall adopt and implement a plan for the sale of such additional securities, including the voting of any shares owned, or proxies held by or controlled by them in favor of said plan. Should the implementation of the plan involve public distribution of Bank securities, including a distribution limited only to the Bank's existing shareholders, 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 the circumstances giving rise to the offering, and other material disclosures necessary to comply with Federal securities laws. Prior to the implementation of the plan and, in any event, not less than 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, 550 17th Street, Room F-6043, N.W., Washington, D.C. 20429, for its review. Any changes to be made in the materials requested by the FDIC shall be made prior to their dissemination. If the Regional Director
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       allows any part of the increase in Tier 1 capital to be provided by the sale of non-cumulative perpetual preferred stock, then all terms and conditions of the issue, including but not limited to, those terms and conditions relative to the interest rate and any convertibility factor, shall be presented to the Regional Director for prior approval.

       (d) In complying with the provisions of this paragraph, the Bank shall provide to any subscriber and/or purchaser of Bank securities written notice of any planned or existing development or of other changes that 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 calendar days of the date any material development or change was planned or occurred, whichever is earlier, and shall be furnished to every purchaser and/or subscriber of the Bank's original offering materials.

       (e) The capital ratio analysis required by this paragraph shall not negate the responsibility of the Bank and its board of directors for maintaining throughout the year an adequate level of capital protection for the kind, quality and degree of market depreciation of assets held by the Bank.

   [.3] 3. RESTRICTION ON DIVIDENDS. As of the effective date of this ORDER, the Bank shall not declare or pay any cash dividend, capital distribution or earnings distribution, without the prior written consent of the Regional Director and the State Bank Commissioner.

   [.4] 4. ALLOWANCE FOR LOAN AND LEASE LOSSES. For purposes of this ORDER and in making the determinations mandated by this paragraph, the board of directors of the Bank shall consider the Federal Financial Institutions Examination Council's Instructions for the Reports of Condition and Income, the Interagency Statement of Policy on the Allowance of Loan and Lease Losses ("ALLL") and any analysis of the Bank's allowance for loan and lease losses provided by the FDIC.

       (a) Prior to the submission of all Reports of Condition and Income required by the FDIC after the effective date of this ORDER, the board of directors of the Bank shall review the adequacy of the Bank's ALLL, provide for an adequate ALLL, and accurately report the same. The minutes of the board meeting at which such review is undertaken shall indicate the findings of the review, the amount of increase in the ALLL recommended, if any, and the basis for determination of the amount of ALLL provided.

       (b) While this ORDER is in effect, the Bank shall submit to the Regional Director and State Bank Commissioner the analysis supporting the determination of the adequacy of its ALLL. These submissions may be made at such times as the Bank files the progress reports otherwise required by this ORDER.

       (c) ALLL entries required by this paragraph shall be made prior to any Tier 1 Capital determinations required by this ORDER.

   [.5] 5. ASSET CHARGE-OFF. Elimination or reduction of assets with the proceeds of other Bank extensions of credit is not considered collection for the purpose of this paragraph.

       (a) As of 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" as of December 8, 2003, that have not been previously collected or charged off.

       (b) As of the effective date of this ORDER, the Bank shall further eliminate from its books, by charge-off or collection, 50 percent of all assets or portions of assets classified "Doubtful" as of the same date that have not been previously collected or charged off.

   [.6] 6. REDUCTION OF SUBSTANDARD ASSETS. For purposes of this ORDER and as used in this paragraph, "reduce" means to collect, charge off, or improve the quality of "Substandard" assets so as to warrant removal of any adverse classification by the FDIC. Furthermore, in developing the plan mandated by this paragraph, the Bank shall, at a minimum, review the financial position of each such borrower, including source of 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.
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       (a) Within 60 days from the effective date of this ORDER, the Bank shall submit to the Regional Director and the State Bank Commissioner, for review and comment, a written plan to reduce the Bank's risk position in each asset in excess of $50,000 which is classified "Substandard" or "Doubtful" in the FDIC's Report of Examination as of December 8, 2003. Within 30 days from the receipt of any comment from the Regional Director, and after due consideration of any recommended changes, the Bank shall approve the plan, which approval shall be recorded in the minutes of a board of directors' meeting. Thereafter, the Bank shall implement and follow this plan.

       (b) The plan mandated by this paragraph shall include, but not be limited to, the following:

         (i) the dollar levels to which risk in each classified asset will be reduced;

         (ii) a description of the risk reduction methodology to be followed;

         (iii) provisions for the Bank's submission of monthly written progress reports to its board of directors;

         (iv) provisions mandating board review of said progress reports; and

         (v) provisions for the mandated review to be recorded by notation in the minutes of the board of director's meetings.

   [.7] 7. PROHIBITION OF ADDITIONAL LOANS TO CLASSIFIED BORROWERS. As of the effective date of this ORDER, the Bank shall not, directly or indirectly, extend any additional credit to, or for the benefit of, any borrower who is already obligated in any manner to the Bank on any extensions of credit (or portion thereof) that has been charged-off the books of the Bank or classified "Loss", so long as such credit remains uncollected. Additionally, the Bank shall not, directly or indirectly, extend any additional credit to, or for the benefit of, any borrower whose loan or other credit has been classified "Substandard" or "Doubtful", or is listed for Special Mention, and remains uncollected, unless its board of directors adopts a detailed written statement giving the reasons why such potential action is in the best interest of the Bank. A copy of such statement shall be placed in the appropriate loan file and shall be incorporated in the minutes of the applicable board of directors' meeting.

   [.8] 8. LOAN COMMITTEE. As of the effective date of this ORDER, the Bank's loan committee shall meet at least monthly.

   (a) The loan committee shall include at least two directors who are "independent." An independent director shall be any individual who:

       (i) is not an officer of the Bank, any subsidiary, or any of its affiliated organizations;

       (ii) does not own more than 10 percent of the outstanding shares of the Bank;

       (iii) is not related by blood or marriage to an officer or director of the Bank or to any shareholder owning more than 5 percent of the Bank's outstanding shares, and who does not otherwise share a common financial interest with such officer, director or shareholder; or

       (iv) is deemed to be an independent director for purposes of this ORDER by the Regional Director or the State Bank Commissioner.

   (b) The loan committee shall, at a minimum, perform the following functions:

   (i) evaluate, grant and/or approve loans in accordance with the Bank's loan policy as amended to comply with this ORDER; and

   (ii) provide a thorough written explanation of any deviations from the loan policy which shall:

   (A) address how such exceptions are in the Bank's best interest;

   (B) be included in the minutes of the corresponding committee meeting; and

   (C) be maintained in the borrower's credit file.

       (c) Review and monitor the status of repayment and collection of overdue and maturing loans, of all loans classified "Substandard" or "Doubtful" in the FDIC's Report of Examination as of December 8, 2003, or subsequent regulatory examination, and of all loans included on the Bank's internal watch list.

       (d) Maintain written minutes of the committee meetings, including a record of the review and status of the loans considered.

       (e) All loan committee minutes shall be made available to the Bank's board of directors at their next scheduled meeting.


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   [.9] 9. LOAN POLICY. Within 60 days from the effective date of this ORDER, and annually thereafter, the board of directors of the Bank shall review the Bank's loan policy and procedures for adequacy and, based upon this review, shall make all appropriate revisions to the policy necessary to strengthen lending procedures and abate additional loan deterioration. The initial revisions to the Bank's loan policy required by this paragraph, at a minimum, shall include provisions:

       (a) establishing review, prior approval and monitoring procedures to ensure that all lending personnel are adhering to established lending procedures and that the directorate is receiving timely and fully documented reports on loan activity, including any deviations from established policy;

       (b) incorporating limitations on the amount that can be loaned in relation to established collateral values for all loan types, including the requirement that the source of the valuations be identified and that such collateral valuations be completed prior to the disbursement of loan proceeds and be performed on a periodic basis over the term of the loan;

       (c) addressing concentrations of credit and diversification of risk, including goals for portfolio mix, establishment of limits within loan and other asset categories, and development of a tracking and monitoring system for the economic and financial condition of specific geographic locations, industries, and groups of borrowers;

       (d) establishing loan underwriting and continuing administration standards for;

         (i) floor plan lending;

         (ii) construction lending; and

         (iii) over-the-road truck and trailer lending;

       (e) establishing standards for the use of loan "sweep accounts," whereby loan proceeds are transferred out of a line of credit and deposited into the borrower's demand deposit account; and

       (f) establishing standards for loan collateral inspections which, at a minimum, address frequency, responsibility and documentation requirements.

   The revised written loan policy shall be submitted to the Regional Director and the State Bank Commissioner for review and comment before its adoption. Within 30 days from the receipt of any comments from the Regional Director, and after due consideration of any recommended changes, the board of directors shall approve the written loan policy and any subsequent modification thereto, which approval shall be recorded in the minutes of a board of directors' meeting. Thereafter, the Bank shall comply with the loan policy.

   [.10] 10. TECHNICAL EXCEPTIONS. Within 60 days from the effective date of this ORDER, the Bank shall correct the technical exceptions listed in the FDIC Report of Examination as of December 8, 2003. "Correct" shall include documented attempts to collect missing information. The Bank shall initiate and implement a program to ensure its credit files contain complete, adequate and current documentation.

   [.11] 11. FUNDS MANAGEMENT POLICY. Within 60 days from the effective date of this ORDER, and annually thereafter, the board of directors of the Bank shall review the Bank's funds management policy for adequacy and shall make the necessary revisions to address the Bank's asset/liability position and strategy. At a minimum, the revised policy shall:

       (a) Conform to the Interagency Statement of Policy on Interest Rate Risk.

       (b) Establish a method to measure/monitor rate sensitivity.

       (c) Establish an acceptable range for the relationship between rate sensitive assets and rate sensitive liabilities.

       (d) Establish acceptable parameters for changes in the economic value of Equity and Net Interest Margin given changing interest rate scenarios.

   [.12] 12. PROFIT PLAN AND BUDGET. The plan and budget required by this paragraph shall contain formal goals and strategies, consistent with sound banking practices, to reduce discretionary expenses and to improve the Bank's overall earnings, as well as a description of the operating assumptions that form the basis for major projected income and expense components.

       (a) Within 60 days from the effective date of this ORDER, the Bank shall submit to the Regional Director and the State Bank Commissioner, for review and comment, a written profit plan and a realistic/comprehensive budget for all categories


{{6-30-04 p.C-6068}

       of income and expense for calendar years 2004 and 2005.

       (b) Within 30 days from the receipt of any comments from the Regional Director, and after adoption of any recommended changes, the Bank shall approve the plan and budget, which approval shall be recorded in the minutes of the board of directors' meeting. Thereafter, the Bank shall implement and follow the plan and budget.

       (c) Within 30 days from the end of each calendar quarter following completion of the profit plan and budget required by this paragraph, the Bank's board of directors shall evaluate the Bank's actual performance against them, record the results of the evaluation, and note any actions taken by the Bank in the minutes of the board of directors' meeting at which such evaluation is undertaken.

       (d) A written profit plan and budget shall be prepared for each calendar year for which this ORDER is in effect.

   [.13] 13. AUDITS. Within 60 days from the effective date of this ORDER, the Bank's board of directors shall formulate and submit to the Regional Director and the State Bank Commissioner, for review and comment, a comprehensive written audit program. Within 30 days from the receipt of any such comments from the Regional Director, and after due consideration of any recommended changes, the Bank shall approve the audit program, which approval shall be recorded in the minutes of the board of director's meeting. The Bank shall thereafter implement and enforce an effective system of internal and external audits. The internal auditor shall make written monthly reports of audit findings directly to the Bank's board of directors. The minutes of the meetings of the board of directors shall reflect consideration of these reports and describe any action taken as a result thereof.

   [.14] 14. LOAN REVIEW. Within 30 days from the effective date of this ORDER, the Bank shall schedule a review of the Bank's outstanding loans totaling $50,000 or more for compliance with its loan policy and procedures. The review shall be conducted after the Bank's loan policy is revised and adopted as required by paragraph 9 of this ORDER. The review shall be conducted by a person or organization that is not an employee or an "affiliate" of the Bank or its holding company. For purposes of this paragraph, "affiliate" shall have the same meaning as Section 23A(b)(1) of the Federal Reserve Act, 12 U.S.C. §371c(b)(1).

   [.15] 15. VIOLATIONS OF LAW AND REGULATION.

       (a) Within 60 days from the effective date of this ORDER, the Bank shall eliminate and/or correct all violations of law and regulation listed in the FDIC's Report of Examination of December 8, 2003.

       (b) Within 60 days from the effective date of this ORDER, the Bank shall implement procedures to ensure future compliance with all applicable laws and regulations.

   [.16] 16. BANK SECRECY ACT COMPLIANCE. Within 60 days from the effective date of this ORDER, the Bank will adopt and implement a Bank Secrecy Act program that, at a minimum:

       (a) provides for a system of internal controls to assure ongoing compliance;

       (b) provides for independent testing for compliance to be conducted by Bank personnel or by an outside party;

       (c) designates the individual or individuals responsible for coordinating and monitoring day-to-day compliance; and

       (d) provides training for appropriate personnel.

   [.17] 17. DISCLOSURE 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 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, notice or statement shall be sent to the FDIC Registration and Disclosure Section 550 17th Street, N.W., Room F-6043, Washington, D.C. 20429 for review at least 20 days prior to dissemination to shareholders. Any requests for changes made by the FDIC shall be made prior to dissemination of the description, communication, notice or statement.

   [.18] 18. COMPLIANCE WITH ORDER. Within 60 days from the effective date of this ORDER, the Bank's board of directors shall have in place a program that will provide for monitoring of the Bank's compliance with this ORDER. Following the adoption
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   of said program, the Bank's board of directors shall reviews the Bank's compliance with this ORDER and record its review in the minutes of each regularly scheduled board of directors' meeting.

   [.19] 19. PROGRESS REPORTS. Within 15 days from the end of each calendar quarter following the effective date of this ORDER, the Bank shall furnish written progress reports to the Regional Director and the State Bank Commissioner, signed by each member of the Bank's board of directors, detailing the form and manner of any actions taken to secure compliance with this ORDER. Such reports may be discontinued when the corrections required by this ORDER have been accomplished and the Regional Director has in writing, released the Bank from making further reports.

   The effective date of this ORDER shall be 10 days after its issuance by the FDIC.

   The provisions of this ORDER shall be binding upon the Bank, its institution-affiliated parties, and any successors and assigns thereof.

   The provisions of this ORDER shall remain effective and enforceable except to the extent that, and until such time as, any provision has been modified, terminated, suspended, or set aside by the FDIC.

   Issued Pursuant to Delegated Authority

   Dated: April 19th, 2004.



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