The Federal Reserve Board has entered into separate written agreements with Doral Financial (DRL) and State Bank of Geneva.
The Fed pushed for the written agreement with Doral after examiners "identified deficiencies" at the San Juan, Puerto Rico, company relating to credit risk management and credit administration practices.
The written agreement replaces a 2006 cease-and-desist order tied to certain mortgage-related activities. The Fed said Thursday that it had terminated the C&D against the $8.3 billion-asset company.
The new agreement requires Doral to serve as a source of strength to its bank and to hire an independent consultant to review all management and staffing needs, along with the qualifications and performance of all senior management. The company must submit a capital plan, along with plans to address credit risk management, credit administration and management of other real estate owned, among other things.
State Bank of Geneva's written agreement requires the Springfield, Ill., bank to provide a plan to strengthen board oversight. The $84 million-asset bank must prepare a capital plan and hire an independent consultant to assess the effectiveness of the bank's corporate governance, board and management structure and staffing needs. Like Doral, State Bank must review its credit risk management and credit administration practices.
