WASHINGTON — For the first time since the government started investing in banks as part of the 2008 bailout, the Treasury Department has ordered board appointments at two banking companies that have missed dividend payments.
Under the Troubled Asset Relief Program, which Congress mandated in 2008 for dealing with the financial crisis, Treasury can appoint up to two directors of its choice at banks that miss six payments. It appointed two directors for the board of First Banks Inc. in Clayton, Mo., and one director for the board of Royal Bancshares Inc. in Narbeth, Pa.
Joining the board of First Banks — which owes over $32 million in unpaid dividends and interest on a $295 million Tarp investment — will be John S. Poelker, the former chief financial officer of Old National Bancorp in Evansville, Ind., and Guy Rounsaville, Jr., a former general counsel for Wells Fargo.
Royal Bancshares, meanwhile, owes $3 million in dividends and payments. Treasury appointed Gerard M. Thomchick, a former chief operating officer at First Commonwealth Financial in Indiana, Pa., to serve on the board of Royal Bancshares.
The new directors "will have the same fiduciary duties and obligations to the shareholders of the financial institutions as any other board members," Treasury said in a press release.
They are not government employees, and will not represent the United States government, Treasury said.
