Ordered by regulators to boost capital levels immediately, Frontier State Bank in Oklahoma City has sold a chunk of its securities portfolio, returning it to well capitalized status.

It remains to be seen whether the bank — whose assets shrank 19%, to $583 million, as a result of the sales — will win a fight to preserve its business model of investing heavily in collateralized mortgage obligations. The Federal Deposit Insurance Corp., which calls this model risky, took Frontier State to court over the matter this month; both sides rested their cases last week.

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