First Sound Bank (FSWA) in Seattle has been released from a regulatory action after improving its capital levels.
The Federal Deposit Insurance Corp. and the Washington State Department of Financial Institutions have lifted a 2010 consent order requiring the $106 million-asset bank to hire qualified management, charge off bad loans and raise its Tier 1 leverage ratio to at least 10%. First Sound announced the lifting of the order on Thursday.
As of June 30, First Sound held Tier 1 capital of 8.74% and total risk-based capital of 13.82%, according to the FDIC.
"Our progress in restoring First Sound Bank to a strong financial condition is due to the efforts of a dedicated and determined staff and board of directors, our very loyal customers and shareholders, and the support we received from state and federal regulators," Chief Executive Patrick Fahey said in a news release.
First Sound hired Fahey in January to lead its turnaround. Fahey had previously led Frontier Financial in Washington, which failed in 2010 after it was unable to secure regulatory approval to sell itself.
In February, First Sound raised $7.9 million and bought back its Troubled Asset Relief Program shares from the Treasury Department for $3.7 million, a 50% discount.