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FDIC cites Wells bank for 'unsound' practices
Published Saturday, February 28, 2009
MINNEAPOLIS — The Federal Deposit Insurance Corp. has ordered two Minnesota banks to cease engaging in what it calls “unsafe or unsound business practices.”
The FDIC cited both Horizon Bank of Pine City and Paragon Bank of Wells for operating with inadequate capital and failing to set aside adequate allowances for possible loan losses.
The cease-and-desist orders were filed in January but made public Friday.
Both banks accepted consent orders with the FDIC without admitting or denying any unsafe practices.
The actions bring to five the number of community banks in Minnesota have been hit with federal or state cease-and-desist orders since last September. The state Commerce Department’s watch list of troubled banks has nearly doubled to 51 from 26 over the past 18 months.
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