The Bank Slate


OCC announces reg orders with three banks

The Office of the Comptroller of the Currency announced enforcement actions against three banks.

The agency entered into a formal agreement with First Federal Savings & Loan Association of Lorain in Ohio. The bank was cited for unsafe or unsound practices, including those related to the failure of the board and management to develop and implement an appropriate strategic plan.

The OCC said the $530 million-asset failed to appropriately manage and control liquidity and interest rate risks, implement effective Bank Secrecy Act and anti-money laundering internal controls, and appoint an experienced BSA officer.

Heritage Bank in Spicer, Minn., agreed to a cease-and-desist order after being cited for unsafe or unsound practices tied to capital adequacy, capital and strategic planning, credit review, monitoring its credit portfolio, liquidity management and the allowance methodology.

The OCC replaced the $578 million-asset bank’s October 2023 formal agreement with the C&D order.

Finally, Minnstar Bank in Lake Crystal, Minn., agreed to a formal agreement to address unsafe or unsound practices, including concentrations of credit, underwriting and administration, appraisals, the loan-loss allowance and strategic planning.

The $216 million-asset bank’s order also addressed incentive compensation, capital planning, liquidity risk management and violations of laws and regulations tied to loans to executive officers, lending limits and appraisals.

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