WASHINGTON — The Federal Reserve and Alabama State Banking Department have issued a cease and desist order that calls on Birmingham's Nexity Financial Corp. to take steps to boost its financial health.
The firm must submit to Fed officials a plan to maintain sufficient capital as well as plans to increase its capital ratios.
Additionally, the order, which was made public Wednesday, prohibits Nexity from declaring or paying dividends. The order also means the firm cannot incur or guarantee any debt without prior approval from regulators.
Nexity Financial Corp. is based in Birmingham, Ala. It has offices in Atlanta; Columbia, S.C.; Dallas-Fort Worth; Myrtle Beach, S.C., and Winston-Salem, N.C.
The order was issued in effort to help "maintain the financial soundness" of Nexity.