NEW YORK — The Federal Reserve issued a "written agreement" between its Chicago Reserve Bank and FBOP Corp., the nation's largest privately held bank.
FBOP, like many banks slapped with regulatory enforcement action, is suffering from low capital and rising losses due to delinquent real estate borrowers.
The Fed ordered FBOP to submit a risk-management plan, reduce its concentration of commercial real estate loans, "maintain sufficient capital" and adopt a methodology to set aside capital for future loan losses "consistent with relevant supervisory guidance."
The bank is barred from paying a dividend without the Fed's consent.
FBOP owns eight banks in various parts of the U.S., the largest of which are California National Bank, with 68 branches and about $7 billion in assets, and Park National Bank, which services metropolitan Chicago with 30 branches and about $4.8 billion in assets.
