Coming off its fourth-straight money-losing year, United Bank of Philadelphia is under orders from state and federal regulators to clean up its loan portfolio, improve its capital ratios and submit to regulators a detailed plan for returning to profitability.

The $77 million-asset has lost roughly $3 million over the last four years and continues to struggle with high levels of problem loans. In an enforcement order made public last month, the Federal Deposit Insurance Corp. and the Pennsylvania Department of Banking ordered United to reduce its level of classified loans and maintain a Tier 1 leverage capital ratio equal to at least 8.5% of assets. At Dec. 31, that ratio was 6.27%.

The bank was also told to establish a board committee that should meet monthly to review the bank's progress in complying with the order and hire an outside consultant to assess management's needs.

United, one of the nation's 28 African-American-owned institutions, said in a news release Thursday that it has formed a committee headed by Chief Executive Evelyn Smalls. Others on the committee are the bank's chairman, Armstead Edwards; Bernard Anderson, a former economist with the Department of Labor and faculty member at the University of Pennsylvania's Wharton School of Business; and Joseph Drennan, the president and chief executive at iDelphix Corp.

In a news release, Smalls said that management and the board intend to work closely with regulators to determine a new strategic direction for the bank.

"Given the lingering impact of the recession on the entire financial services sector and our specific and critical focus on the African-American community, the board and management will use the [consent] agreement as a roadmap to improving the performance of the bank," Smalls said.

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