Fed Ends Action Against a Va. Bank, Fines an Iowa Bank

The Federal Reserve Board has terminated an enforcement action against Eastern Virginia Bancshares in Tappahannock and has fined Blencoe State Bank in Iowa.

The Fed announced the termination of its 2011 written agreement with Eastern Virginia Bancshares and its bank subsidiary, EVB, on Thursday. The agreement required Eastern Virginia to improve its board's oversight of the bank, submit a plan to improve the management of its credit risk, improve its asset quality and conduct an internal audit.

The $1.1 billion-asset Eastern Virginia has raised $50 million in the past several months in order to shed the regulatory action, dispose of problem assets and restructure $117.5 million of Federal Home Loan bank advances. It sold a 30% stake to a group of institutional investors, then sold $5 million of common stock to existing shareholders.

EVB had a Tier 1 leverage ratio of 7.48% and total risk-based capital of 13.14% at the end of June, according to the Federal Deposit Insurance Corp.

The Fed also announced Thursday that on July 30 it fined the $40 million-asset Blencoe State Bank $1,140 for violating national flood-insurance requirements.