Home Federal Savings Bank in Rochester, Minn., has been freed from a supervisory agreement with the Office of the Comptroller of the Currency.
HMN Financial (HMNF) said in a press release Friday that the OCC also lifted its bank's individual minimum capital requirement.
The February 2011 agreement required Home Federal to address issues with its credit quality and financial performance. The $647 million-asset bank was also ordered in December 2011 to maintain a minimum core capital ratio of 8.5%. Home Federal had a 12.2% core capital ratio at Dec. 31, according to the Federal Deposit Insurance Corp.
"We are pleased that the improvements in our financial results and capital position have allowed these agreements and restrictions to be terminated," HMN President Brad Krehbiel said in the release. "We will continue to focus our efforts on improving the financial performance of our core banking operations."