Lake Shore Bancorp in Dunkirk, N.Y. has suspended its quarterly dividend after its bank was classified as being in a “troubled condition” by the Office of Comptroller of the Currency.
The $700 million-asset company disclosed in a regulatory filing that it will focus its capital resources on fixing “operational, compliance and governance deficiencies described in the order.”
Lake Shore agreed to a consent order on Feb. 9 that replaces a written agreement that has been in place since last July.
Lake Shore must create a compliance committee to monitor and oversee the compliance with the order and submit monthly reports to the bank’s board and the OCC.
The bank is required to develop, adopt, implement, and follow a corporate governance program. The order also requires more oversight over the performance of the bank’s management.
Written plans must be submitted to the OCC for a three-year period, and a written program is required for the bank’s IT activities. Lake Shore must also have a written program with safeguards for securing customer data.
The agreement also requires the bank to analyze its Bank Secrecy Act and anit-money laundering risk profile and strategic direction, among other things.