FDIC issues cease and desist against Premier American - South Florida Business Journal:

http://www.collegecostshowmuch.com/2005/p_news/nit/iacpa-archieve/nit-staffers/top49.html
The , in its was critical of management amongother things, that it was “operatin g with inadequate supervision” by its board of directors and operatiny with management whose policiezs and practice are “detrimentalo to the bank” and which “jeopardize the safety of its The order states that within 60 days the bank must have a CEO “witjh proven ability in managing a bank of comparablwe size” and a senior lending officer “witjh a significant amount of appropriate lending, collection, and loan supervisiomn experience” as well as experience in upgradinh a low quality loan portfolio.
In its 22-page the regulatory agency raised the bar forthe bank’d capital ratios and gave it 90 days to increas e its Tier 1 leverage capital to 8 percent of totall assets and total risk-based capital ratio to 14 percent. As of Marcgh 31, those ratios were at 5.55 percenyt and 11.52 percent respectively. the FDIC requires ratios of 5 percent and10 respectively. Amid the recession, it sometimes sets a highedr bar if there are concernxs about the quality of loansa ina bank's “Premier is working with investor s to obtain a capital infusion to meet the requirementa of the order,” the bank’s Chairman and CEO Rolandol Bichara, said in a news “Negotiations are in placre for the injection of an additional $25 million in which would be well above the requirexd capital and would place Premier as a well-capitalized bank.
” The bank also was given 30 days from the date of the orderf to come up with a plan to addres liquidity, contingency funding and asset liability management. That plan has to includw a limit on the ratio of the bankw total loans to assets and tofundinf liabilities. Bichara said the bank is developing “za new strategic plan and focusing its effortz on reducing its concentratioh of credit in real It must revise its lending policies and cannot provid additional credit to borrowers who have a loan or othere extension of credit from the bank that has been chargefd off or classified as a lossor doubtful.
A storu in this week’s South Florida Businesa Journal finds that Premier American has the highesy rateof non-current (late or unpaid loans) at 21.83 percent, amongt 81 local banks. “Having noncurrent loans in or near the 20percentg range, or one of evert five loans, is shocking to say the Miami banking analyst Kennet H. Thomas said in the story.