Regulators are clamping down on Hampton Roads Bankshares Inc. in Virginia, despite a private-equity recapitalization plan.
The $3 billion-asset company announced late last week that it and its Bank of Hampton Roads unit, entered into a written agreement with the Federal Reserve, giving the undercapitalized bank 60 days to submit a capital plan.
It also calls for the holding company to serve as a source of strength to the bank and submit plans detailing how it plans to strengthen the board's oversight, improve credit oversight, deal with problem credits and reduce its reliance on brokered deposits, among other things.
At the end of the first quarter, the bank's total risk-based capital was 7.48%. In late May the company announced that Carlyle Group and Anchorage Advisors LLC had each agreed to buy $73 million of the company's common stock, so long as the company is able to raise a total of $275 million in fresh capital.