The Federal Reserve Board and WSB Financial Group Inc. signed an agreement Tuesday that would, among other things, restrict WSB's dividend payments and debt.
WSB, the parent company of Westsound Bank in Bremerton, Wash., must now win approval from the Federal Reserve Bank of San Francisco before declaring or paying dividends. It is also barred from increasing or guaranteeing any more debt without a nod from the San Francisco Fed and must also submit a plan within 45 days that would create rules for doing business with affiliates.
In the agreement, the Fed said the central bank and WSB share the "common goal to maintain the financial soundness" of the institution.
In March the Federal Deposit Insurance Corp. issued a cease-and desist-order against the bank that required it to strengthen lending practices and find a new chief executive.
