Feds pressure Border Trust
Another Maine bank is under the scrutiny of federal regulators for "unsound banking practices and violations of law and/or regulations."
The Federal Deposit Insurance Corp. on Aug. 12 issued Augusta-based Border Trust Co. an order to cease and desist after finding several violations, including operating with "an inadequate level of capital protection for the kind and quality of assets held by the bank" and having "an excessive level of delinquent loans" and "adversely classified loans or assets." The cease-and-desist order also cited the bank's inadequate earnings, subpar written loan policies and management practices.
The order called for an evaluation of the bank's management personnel, increases to its capital and establishing a greater allowance for loan and lease losses. It also orders Border Trust to eliminate its assets classified as a loss by the FDIC or the state, reduce its delinquent loans and draft a comprehensive budget for 2009 that reduces expenses and improves earnings.
Border Trust Co. has five offices in Maine, with two in Augusta, and one in South China, Topsham and Jackman, according to the FDIC.
Also this month, the federal Office of Thrift Supervision issued a cease-and-desist order to Gardiner-based Savings Bank of Maine for insufficient capital and lackluster security measures.
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