The Federal Deposit Insurance Corp. did not respond quickly or effectively enough to problems at a $276 million-asset Florida bank that failed in October, a watchdog agency said.

The FDIC inspector general said in a report that the agency should have been more aggressive with Freedom Bank of Bradenton after finding management and asset-quality flaws in 2005 and 2006.

The report attributed Freedom's failure largely to losses from bad commercial real estate loans. But the inspector general said the agency did not take supervisory action against the bank until 2007 and 2008, even though it had identified warning signs earlier.

"The FDIC has authority to take a wide range of supervisory actions," the report said. In this case, "supervisory actions were not timely and effective in addressing the bank's most significant problems."

By statute, post-failure reviews are required whenever a closure causes a "material loss" to the Deposit Insurance Fund. Since the start of the crisis, 11 such reports have been issued, and they have criticized multiple regulators.

In response to the Freedom report, a senior FDIC official noted steps the agency took to clamp down but agreed that it could have done more.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.