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3 severe enforcement actions handed out to US banks in June


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3 severe enforcement actions handed out to US banks in June

During the second quarter, six severe enforcement actions were handed out to U.S. banks and thrifts by federal banking regulators, compared to six in the year-ago quarter and nine in the first quarter. Three of the second quarter's actions were given in June.

As of July 29, 120 U.S. banks and thrifts were operating under a severe enforcement action.

Newark, N.J.-based City National Bank of New Jersey received a prompt corrective action directive, or PCAD, on June 26 that replaced its previous PCAD from November 2018. The June order requires the bank to submit a capital restoration plan as well as an acquisition or combination plan. The bank remains undercapitalized, and its leverage ratio fell to 3.10% as of June 30, from 3.83% at the end of March.

On June 20, Texas-based First National Bank of Tahoka received a consent order from the Office of the Comptroller of the Currency requiring the company's board to correct issues regarding Bank Secrecy Act compliance, inaccurate call reports, transactions with insiders, excessive dividends, as well as other issues.

On June 6, Oxford, Mich.-based Oxford Bank received a cease and desist order from the Federal Deposit Insurance Corp. tied to consumer protection compliance.

On May 3, Green River, Wyo.-based State Bank was handed a cease and desist order from the FDIC, which requires the company to maintain a leverage ratio of at least 10%. As of June 30, the company reported a 12.88% leverage ratio.

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Click here to view the map as a PDF. To view a refreshable spreadsheet of all operating banks and thrifts under a severe enforcement action as of Aug. 5, click here.