Lineage Financial in Tenn. enters into written agreement with Fed

Lineage Financial Network in Franklin, Tenn., is dealing with an enforcement action from the Federal Reserve.

The Fed issued a written agreement to the parent of the $214 billion-asset Lineage Bank that requires it to serve as a “source of strength” to the bank.

Lineage Financial must maintain an adequate number of directors with the necessary skills, training, experience and qualifications to fulfill their roles. The company must also prepare and submit cashflow projects to the Fed.

The company must prepare and submit written progress reports to the Fed 45 days after the end of each quarter. The agreement also requires the company to secure Fed approval before paying dividends or buying back stock.

The Fed noted that its enforcement action is independent of the bankruptcy proceedings regarding Synapse Financial Technologies.

Lineage Bank, which once had big Banking-as-a-Service (BaaS) aspirations, has been operating under a consent order with the Federal Deposit Insurance Corp. since January. That order requires it to address unsafe and unsound banking practices tied to third-party management of its fintech programs.