The agreement and the order (collectively, the regulatory agreements) contain a list of strict requirements ranging from a capital directive, which requires Corus Bankshares (Corus) and the Corus Bank (bank) to achieve and maintain minimum regulatory capital levels (in the bank’s case, in excess of the statutory minimums to be classified as well-capitalized) to developing a liquidity risk management and contingency funding plan, in connection with which the bank will be subject to limitations on the maximum interest rates the bank can pay on deposit accounts.
The regulatory agreements also include several requirements related to loan administration as well as procedures for managing the bank’s growing portfolio of foreclosed real estate assets. Corus is also restricted from paying any dividends or making any capital distributions, including distributions related to its trust preferred debt without advance regulatory approval.
The bank has agreed to form a board compliance committee, which will be charged with monitoring and coordinating its adherence to the provisions of the regulatory agreements. Corus and the bank will be required to provide regular progress reports to both the board of directors and the regulators.
Robert Glickman, president and CEO of Corus, said: The regulatory agreements are the result of ongoing discussions between the Office of the Comptroller of the Currency (OCC), the Federal Reserve Bank of Chicago (FRB) and Corus’s senior management over the last few months to address the negative impact that current market conditions are having on Corus and how best to resolve them. We believe the remedial measures agreed upon with the regulators are necessary to address asset quality deterioration and overall risk management.
