TrustCo Bank Corp NY in Glenville, N.Y., has agreed to improve corporate governance, capital planning, internal auditing and other areas after federal regulators found the issues during an examination.
The $4.7 billion-asset company said noninterest expense will rise between $2.5 million and $5 million because of the order. TrustCo entered into the formal agreement with the Office of the Comptroller of the Currency on Tuesday.
Among several requirements, TrustCo must establish a compliance subcommittee for its board of directors and adopt compliance plans with the help of an independent consultant. The consultant will also assist on implementing improvements to corporate governance and auditing. TrustCo must also develop a strategic plan, a revised capital plan and an improved loan review system.
The issues were raised after the OCC completed its regularly scheduled exam, TrustCo said in a news release.
Kevin Timmons, TrustCo's treasurer, told the Albany (N.Y.) Times Union that the agreement comes on the heels of new banking regulations, noting that TrustCo has good capital levels and liquidity and that it remains profitable. Timmons did not immediately return a request for comment.
Separately on Tuesday, TrustCo reported that second-quarter net income fell 9.3% to $10.7 million, from a year earlier.