The Federal Reserve Board has terminated enforcement actions against Community Bankers Trust (BTC) in Glen Allen, Va., and Northwestern Bank in Chippewa Falls, Wis.
Community Bankers had been operating under a written agreement since April 2011 that required the $1.1 billion-asset company to serve as source of strength for its Essex Bank and to strengthen the bank's management.
The order also obligated the bank to detail in writing plans to improve lending and credit administration, to strengthen credit risk management, to review its loan portfolio, to improve its position with respect to any past-due loan in excess of $1 million, to boost regulatory capital and to improve earnings.
It also directed Essex Bank to withhold credit from any borrower whose loan had been criticized by examiners, to eliminate from its books loans examiners had classified as lost that had not been previously charged off, and to refrain from paying dividends, incurring debt or redeeming stock without regulators' approval.
The $366 million-asset Northwestern Bank had been under a written agreement since April 2010 that required the bank's board to strengthen its oversight of management.
The order obligated Northwestern to provide written plans to improve lending and credit administration, to boost regulatory capital and to improve earnings. Among other things, the agreement directed the bank to refrain from paying dividends without Fed approval, to withhold credit from any borrower whose loan had been criticized by examiners, and to improve the bank's position with respect to any past-due loan in excess of $500,000.
