Village Bank in Midlothian, Va., has been released from an enforcement order issued by the Federal Deposit Insurance Corp. and Virginia Bureau of Financial Institutions.
In a Dec. 28 press release, Bill Foster, the chief executive of the $420 million-asset bank's parent company, Village Bank and Trust Financial Corp, heralded the decision as an "important milestone."
"We have been back on offense for some time," he said, adding that the company has set a target of achieving a return on assets of above 1% and a return on equity of above 10%. At Sept. 30, its ROA was O.55% and its ROE was 6.70%, according to the FDIC. Its returns on assets and equity were below zero at the same time a year earlier.
The order, imposed in February 2012 and terminated on Dec. 14, required the bank to boost its capital levels and improve board oversight of management. It also directed the bank to limit its use of loan interest reserves, and to seek regulatory approval before dividend and bonus payouts.
Village Bank reported a Tier 1 capital ratio 12.6% as of Sept. 30, up from roughly 8.75% at the time the order was issued, according to the FDIC.