Dedicated to Deposits: Deals, Data, and Discussion

FDIC Releases October Enforcement Actions

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I'm guessing there won't be any bank failures today since it's a holiday weekend. The FDIC did release its October Enforcement Actions today. They issued several Cease-and-Desist orders, and there were a few banks on the list that I've posted on. Some of these include:
The FDIC also issued three Prompt Corrective Actions. Two of these three banks I've reported on before:
The Office of Thrift Supervision also has issued Cease-and-Desist orders, and one of the recent orders was issued for Charter Bank of New Mexico (see order). This explains why Charter Bank slashed their reward checking rate early this month. I had speculated this might be the case last week.

CalculatedRisk Blog has updated its unofficial problem bank list based on these enforcement actions. The list now includes 543 banks.

References:

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Comments
6 comments.
Comment #1 by Anonymous posted on
Anonymous
How ironic. I just paid-off my mortgage at Charter Bank of New Mexico two weeks ago. Now they get a cease and desist order.

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Comment #2 by Anonymous posted on
Anonymous
Worth reading the "cease and desist" order. A multitude of sins.

The one that might affect people with accounts there: "(failure to maintain accurate and complete books and records)."

If I hadn't kept good records of my account at an institution that went under, I would have lost several hundred dollars.

The new outfit didn't have records on when the CDs were issued.

As a result, they wanted to charge me a much bigger early withdrawal penalty.

1
Comment #3 by Anonymous posted on
Anonymous
C&D order is NOT a big deal. Many banks who got it are still in good shape. It is an overly-pessimistic list (not a death sentence at all!!), IMHO.

1
Comment #4 by Anonymous posted on
Anonymous
Continued from above post:

The list, at best, serves as a guideline for selecting Reward Checking Accounts, since the C&D banks MAY be limited in rate by FDIC.

1
Comment #5 by Anonymous posted on
Anonymous
Dumb question....What is a Prompt Corrective Action?

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Comment #6 by Anonymous posted on
Anonymous
A Prompt Corrective Action means to do something to resolve your financial condition. You can merge with another bank, sell out to another bank, sell shares or obligations in order to come up with some capital. The current state of business of the bank has not improved and needs some kind of action. I have an account with one of these banks, so it may be time to start to slowly back out from it. Too bad. It was a good bank in terms of customer service, but got into the mortgage mess.

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