Government issues cease-and-desist order to Bank of Granite

By: Richard Craver | McDowell News
Published: September 04, 2009

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Bank of Granite Corp. was issued today an "order to cease and desist" by the Federal Deposit Insurance Corp. and the N.C. Commissioner of Banks.

The agencies said that the order became effective Aug. 27 and the bank was notified on Wednesday.

As part of the order, the agencies are requiring the bank to provide a written capital plan within 30 days that includes several requirements. They include:

- Achieving a Tier 1 leverage capital ratio of not less than 8 percent and a total risk-based capital ratio of not less than 12 percent during the life of the order.
- Ceasing to extend additional credit to any borrower who has a loan or extension of credit with the bank that is classified as "loss" or "doubtful."
- Not paying cash dividends without the prior written consent of the FDIC and the commissioner.

"We are committed to working with the FDIC and the commissioner to implement the actions required by the order," said Scott Anderson, the chief executive of Bank of Granite.