First Bank of Delaware to Cease Operations

M&A

Bryn Mawr of Pa. to Buy Branch, Assets from First Bank of Delaware

Bryn Mawr Trust Company in Pennsylvania is expanding its banking operations into Delaware to go along with its wealth management business there.

By Alan Kline

May 2
CompuCredit in $116 Million FDIC Subprime Settlement

WASHINGTON — The Federal Deposit Insurance Corp. announced Friday that CompuCredit Corp. will pay $116 million and reform its practices to settle charges the Atlanta marketing firm misled subprime credit card users.

December 22
Delaware Bank Ordered to Close Lending Unit

First Bank of Delaware has agreed to overhaul its consumer lending unit, which regulators have said is engaging in unsafe banking practices.

December 10

First Bank of Delaware, which had been repeatedly cited for violations in its consumer lending business, will cease operations after regulators determined that the bank was lax in monitoring relationships in two business lines.

The $257 million-asset bank announced the first step in its wind down last week when it agreed to sell one branch in Wilmington, Del., and certain loans and deposits to $1.8 billion-asset Bryn Mawr Bank (BMTC). The cash deal with Bryn Mawr, as well as First Bank's proposal to liquidate and dissolve itself, both require approval from the Federal Deposit Insurance Corp.

Representatives for First Bank, which is also based in Wilmington, did not return calls seeking comment. An FDIC spokesman declined to comment.

In a Dec. 29, 2011, consent order, the FDIC told First Bank to stop offering e-payment services and to terminate all relationships with money services businesses. First Bank was ordered to hire an outside firm to analyze past e-payment transactions for suspicious activity and to review its Bank Secrecy Act and Office of Foreign Assets Control compliance programs.

The FDIC also directed the bank's board to increase its oversight of compliance "with particular focus on monitoring the activities and use of third parties" by the bank, according to the consent order.

Joseph Manion, who had been a senior vice president and corporate controller at TD Bank, became the bank's acting president and CEO in November, after the departure of Alonzo Primus, according to First Bank's annual report.

Regulators have been watching First Bank for some time. In October 2008, First Bank reached a settlement of up to $1 million for its participation, along with Atlanta-based CompuCredit (CCRT), in the practice of misleading subprime credit card users. First Bank also agreed that month to close its consumer lending unit because of inadequate compliance monitoring and faulty board oversight.

The FDIC fined the bank $190,000 earlier this year for discriminating against Hispanics by rejecting credit card applications based on a federal listing of foreign nationals.

Harry Madonna, the bank's executive chairman, is also the chairman and chief executive of the $958 million-asset Republic First Bancorp (FRBK) of Philadelphia. First Bank was spun off from Republic First in January 2005.

Andy Peters

twitter