Flathead Holding Co. of Bigfork, Mont., has entered into an agreement with regulators to bolster its capital.
The parent company of the $207 million-asset Flathead Bank agreed not to take or declare any dividends, repurchase stock or take on new debt without the approval of the Federal Reserve Bank of Minneapolis. The company must also deliver quarterly progress reports.
The enforcement action, signed Dec. 14, follows a consent order that Flathead Bank entered into in August with the Federal Deposit Insurance Corp. and the Montana Division of Banking and Financial Institutions. The order mandated greater board oversight of the bank and laid out steps to take to improve its capital ratios.
Flathead Bank had a total risk-based capital ratio of 19% as of the end of 2012, with a 9% Tier 1 leverage ratio, according to the FDIC. The bank recorded $4.1 million in chargeoffs on the quarter and put aside $2.8 million for loan losses.
Flathead Bank did not immediately return American Banker's calls seeking comment.