A Georgia-based bank is under a “temporary cease and desist” order issued by the Federal Deposit Insurance Corp.
Ellaville-based Central Bank of Georgia, which has two branch offices and a mortgage office in Macon, was on the FDIC’s list of orders of administrative enforcement actions taken against banks in July that was released late Friday.
“This actually relates to items that were in the first quarter of 2009,” said Richard Frith, acting CEO of Central Bank. “We had some issues and are resolving them and expect to come out of this in great shape.”
The bank already has begun working on correcting some of the problems the FDIC wants corrected, and bank customers are not affected, Frith said.
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“It shouldn’t change anything,” he said. “We are still open for business and everything’s running smoothly.”
In its notice of charges, the FDIC said the bank had engaged in unsafe or unsound banking practices in various ways, such as “it has manipulated and misstated its quarter-end capital accounts.”
Also, the notice stated that the bank “has engaged in lax loan underwriting and administration,” such as extending loans with inadequate credit information.
The order issued by the FDIC on July 28 sets out various actions the bank must take, including:
Ÿ Within 60 days of the order, the bank will add three new independent members to its board of directors.
Ÿ The bank cannot “accept, renew or roll over brokered deposits without obtaining a brokered deposit waiver approved by the FDIC.”
Ÿ The bank shall not declare or pay any dividends without prior written consent of the FDIC.
The current economy has been hard on all financial institutions, Frith said.
“Our bank is not immune to these problems,” he said. “The (bank’s) board has proactively corrected the deficiencies identified in the order and has made significant progress.”