Shoreline Bank is the latest Washington community bank to come under closer regulatory oversight, the Federal Deposit Insurance Corp. disclosed Friday.
In a consent order issued by the FDIC and the state Department of Financial Institutions, Shoreline Bank was ordered to raise its capital ratios, reduce problem loans, lower its concentration of construction and land development loans and set aside more money to cover expected loan losses.
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With respect to a statement about the regulatory oversight matter, I refer you to our Bank web site. On the financial information page I articulated some thoughts back in November that are still relevant today. I would add the following.
Our Board, management and staff have been engaged in a series of action steps over the past year to address the the severe decline in real estate values resulting from the weakness in the residential construction industry. These steps have been formalized in the improvement plan referred to as a "Consent Order." The Order was entered into in late December 2009 between Shoreline Bank, the FDIC and the State Department of Financial Institutions (DFI).
The Order addresses the need for more capital, reduction in the amount of troubled loans and concentration in construction, maintaining strong cash liquidity and returning to Bank profitability over time. These will be areas of continued and serious focus during the coming year.
We have made significant progress reducing exposure in our construction and development loans. During 2009 we reduced this category by $36.5 million. We have a lot more work to do since real estate values are still weak.
I will add that bank customer deposits are safe and fully FDIC insured up to $250,000 per account holder. In fact, significantly more than this amount can be insured and we can help customers work with the FDIC guidelines on this matter.
Shoreline Bank is a community business. We appreciate the continued support of our customers, local shareholders and the community at large. We need help if we are to succeed with the improvement plan for 2010. We welcome new deposit accounts. Local deposits help us reinvest in this community. We also need to raise capital during 2010 and more information about this will be forthcoming later this spring.
Jeff Lewis
President and CEO
Shoreline Bank
I appreciate the comments made by Jeff Lewis bringing the community up to date on the progress of Shoreline Bank.
ReplyDeleteCommunity Banks have a vested interest in the well being of the communities that they serve. As a result they are much more responsive to the needs of those communities unlike most Corporate banks who helped cause the current financial crisis.
It is my hope that Shoreline Bank will continue to improve its position over time and to the benefit of the community at large.
Wendy DiPeso