Magazine article American Banker

In Brief: OCC Shuts Net First of Fla.; Fifth Bank Failure in '02

Magazine article American Banker

In Brief: OCC Shuts Net First of Fla.; Fifth Bank Failure in '02

Article excerpt

In the fifth bank failure this year, federal regulators Friday shut $34 million-asset Net First National Bank of Boca Raton, Florida.

Though it is only March, the number of bank failures this year has already surpassed last year's total of four.

The Comptroller of the Currency said it closed Net First after finding the bank was "engaged in unsafe and unsound practices that had caused substantial dissipation of its assets and earnings." The agency said the bank had lost $1.9 million in 2001 and that it concluded the institution would continue to lose money "because of its unsafe and unsound practices."

Those problems included weak loan underwriting, excessive turnover among senior management, disarray among the board of directors, insufficient capital to support the risks undertaken by the bank, and inaccurate financial books and records, the OCC said.

In September of 2000, the OCC issued an enforcement action against the bank, requiring it to take a series of steps to improve its conditions. …

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