MONROE — Satisfied with the progress Monroe Bank & Trust has made to improve its financial condition over the past four years, federal and state regulators have lifted official orders requiring the bank to take certain steps to stabilize its operations.
The Monroe bank, a subsidiary of MBT Financial Corp., was hit hard by the recession and struggled with a large number of foreclosures and other troubled loans. Because of those issues, the Federal Deposit Insurance Corp. and Michigan’s Office of Financial and Insurance Regulation put the bank under a supervisory consent order formally requiring it to improve its financial condition.
Monroe Bank & Trust recently completed a $20 million stock offering to raise capital and meet regulators’ last stipulation. Bank officials said Thursday the company was notified at the end of June that the consent order had been lifted.
“We are very pleased with the termination of the consent order, as it reflects the considerable effort by our board, officers, and staff to improve asset quality and earnings,” president and CEO Doug Chaffin said in a statement.
A call seeking comment from the bank was not returned Thursday.
Monroe Bank & Trust had a $33 million loss in 2010, but returned to profitability in 2012. The bank has been profitable for 11 consecutive quarters, and officials say its health continues to improve.
BauerFinancial Inc., a Florida bank research firm, upgraded Monroe Bank & Trust to an “adequate” rating at the end of 2013 after rating it “problematic” for nearly three years because of its nonperforming loan portfolio.
Though the formal regulatory supervision has ended, in a filing with the U.S. Securities and Exchange Commission, the bank said some informal requirements and restrictions remain in place, including a prohibition on paying dividends without prior approval from regulators. The bank also must continue to improve its credit quality.
Bank officials said earlier this year that total problem assets in the first quarter were down $33.8 million, or 27 percent, from the first quarter of 2012.
Shares of MBT Financial rose 3 percent Thursday to close at $5.34. Shares have risen 178 percent since the consent order was announced in July, 2010.