Coastal Banking Company, the holding company of CBC National Bank, and First National Bank of Nassau County in Florida have announced that CBC National Bank has signed an agreement with the Comptroller of the Currency (OCC). The deal outlines strategies the bank will continue to employ to reduce credit risk, and improve its asset quality and earnings.
CBC National Bank’s formal agreement calls for the bank to reduce its level of credit risk, with an emphasis on commercial real estate, improve the quality of individual assets in excess of $500,000, as well as its profitability. It also calls for its board to appoint a compliance committee to oversee and ensure compliance with the formal agreement, according to Coastal Banking Company.
Michael Sanchez, CEO of Coastal Banking Company, said: In mid-2008, we recognized the severity of the economic and real estate market downturn, and nearly a year ago put in place strategic measures to address specific issues related to them.
We have significantly lessened our concentration of commercial real estate-related loans and have worked diligently to strengthen overall loan portfolio management, mitigate credit risk and improve asset quality. We formed a special assets group in the fourth quarter of 2008 to work actively and aggressively with borrowers to resolve or restructure weak loans and, when necessary, to liquidate the collateral as quickly and profitably as possible. Our special assets group has recovered almost 80 cents on the dollar of the original loan amount for real estate owned sold during the first half of 2009.
