FDIC Orders Parkway Bank to Clean Up

by Talk Business & Politics ([email protected]) 64 views 

Parkway Bank of Rogers is the latest Arkansas bank to be sanctioned by federal regulators for unsafe and unsound bank practices.

The Federal Deposit Insurance Corp. revealed on Sept. 26 that it had entered into a consent order with Parkway on Aug. 5. Parkway officials voluntarily agreed to the order without admitting or denying the allegations.

Those allegations include operating the bank “with management whose policies and practices are detrimental to the bank and jeopardize the safety of its deposits.”

The order requires the bank to come up with additional capital.

Jerry Sadler, chairman and CEO of Parkway Bankshares Inc., issued a statement in response to the FDIC order.

“The board of directors of Parkway Bank felt that the entry of the order was in the best interest of the bank in order to forego a protracted administrative proceeding,” Sadler said in the statement.

“Parkway Bank is working closely with the FDIC to resolve those matters covered in the order expeditiously. We believe we have taken and continue to take significant steps to deal with the matters contained in the FDIC order. The issuance of this order is a formalization of self-imposed actions previously enacted by the board of directors of Parkway Bank.”

Parkway Bank, a wholly owned subsidiary of Parkway Bankshares Inc., also has offices in Crossett, Monticello and Portland, where it was originally chartered.

Parkway had assets of just under $150 million as of June 30, according to FDIC data, down from $172 million in mid-2007. The bank reported a net loss of $1.94 million in 2007 and a net loss of $42,000 for the first two quarters of 2008.

The bank had $6.3 million in loans in nonaccrual status as of June 30, up from $2.3 a year earlier.

Parkway had about $80.3 million in deposits as of June 30. About $72 million of those deposits were in Benton County.