Union National Community Bank in Lancaster, Pa., entered a memorandum of understanding with the Office of the Comptroller of the Currency last week.
The $459 million-asset bank must implement a three-year strategic plan and a three-year capital plan and follow specific guidelines in the memorandum, its parent company, Union National Financial Corp., disclosed in a June 21 filing with the Securities and Exchange Commission.
It also must improve its loan portfolio management, implement a risk-based audit program to determine compliance weaknesses, and ensure it has an acceptable model for measuring interest rate risk.
Federal Deposit Insurance Corp. data indicates that the bank had high levels of chargeoffs in its consumer and residential mortgage portfolios in the first quarter. Also, its levels of risk-based capital were significantly lower than those of other commercial banks in its asset class.
