Federal bank regulators have cited two more Colorado banks for violating safe-banking standards, placing them under enforcement orders to try to prevent further risky practices.
Rocky Mountain Bank & Trust of Florence and Pikes Peak National Bank of Colorado Springs join seven other Colorado banks that have faced strict regulatory action — including one shutdown and one forced sale — during the last 18 months.
The two banks were primarily faulted for lax lending practices and directed to overhaul their standards to ensure financial stability.
Rocky Mountain Bank & Trust also was ordered to boost its capital, or cash — possibly through the sale of securities or some other means — to cover losses.
Pikes Peak was required to develop a contingency plan to “remain liquid through stressed environments.”
According to Pikes Peak president Robin Roberts, the bank has met requirements of the comptroller of the currency’s cease-and-desist order after facing a May 31 deadline.
“We view our agreement as being primarily caused by the current economy and the fact that many of our small-business customers are feeling a tightening in their cash flow,” Roberts said in a written statement.
Executives with Rocky Mountain Bank & Trust could not be reached for comment.
The Federal Deposit Insurance Corp. cited the Florence institution with 14 violations, including operating with inadequate policies for risk control, paying excessive dividends and placing large concentrations of deposits with “one entity.” Its board of directors provided poor oversight, according to the FDIC.
As with most of the state’s other troubled banks, Rocky Mountain Bank had high concentrations of commercial real-estate lending compared to its capital. The FDIC has given the bank 90 days to reduce the number of those loans.
Miles Moffeit: 303-954-1415 or mmoffeit@denverpost.com
Other banks cited by the FDIC
The seven other Colorado banks placed under enforcement orders by regulators in the last 18 months:
First National Bank of the Rockies
Headquarters: Grand Junction
Net worth: NA
2007 assets: $369,122,000
Cañon National Bank
Headquarters: Cañon City
Net worth: $16,300,000
2007 assets: $208,725,000
New Frontier Bank
Headquarters: Greeley
Net worth: $109,623,000
2007 assets: $1,322,021,000
Native American Bank
Headquarters: Denver
Net worth: $9,371,000
2007 assets: $99,750,000
Colorado National Bank
Headquarters: Colorado Springs (owned by Team Financial of Paola, Kan.)
Net worth: $30,420,000
2007 assets: $123,602,000
McClave State Bank
Headquarters: McClave
Net worth: $1,746,000
2007 assets: $18,488,000
Southern Colorado National Bank
Headquarters: Pueblo
Net worth: NA
2007 assets: $44,089,000
Sources: BankNews Bank Directory, Dun & Bradstreet’s Dun’s Market Identifiers, Denver Post archives
