Bank of Georgia receives Order from FDIC; says issues largely resolved

Mon, 08/03/2009 - 1:42pm
By: Ben Nelms

Bank of Georgia has received a Cease and Desist order from the Federal Deposit Insurance Corp. (FDIC) concerning a number of banking practices that FDIC said could constitute unsafe or unsound practices and regulation violations. But Bank of Georgia said those concerns, based on a report from September 2008, have been largely resolved.

Bank of Georgia executives see the Order from a different point of view. President Pat Shepherd and CFO Lynn Gable contend that nearly all of the one-dozen concerns listed were addressed subsequent to the September 2008 bank examination.

Those compliance areas were not noted in the June 2009 order. Of the few concerns that remain, they are largely tied to the Fayette/Coweta economies and to that of metro Atlanta.

Gable and Shepherd maintained that BOG’s loan business is geared primarily to the building and construction industry, adding that the bank has made no sub-prime residential loans.

“We made too many construction loans but nobody, including in the banking system in metro Atlanta marketplace, predicted what was going to happen with the local economy. We can’t change the economy but we can change the way we do business,” said Shepherd. “We’re not going anywhere. We are not going to fail. There’s no way.”

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Spear Road Guy's picture
Submitted by Spear Road Guy on Mon, 08/03/2009 - 2:45pm.

Like Southern Community Bank, this one was set up by builders for builders.

And if Pat Shepherd, couldn't see the crash coming, maybe they need a new president.

Vote Republican


Submitted by Bonkers on Mon, 08/03/2009 - 3:20pm.

I saw a similar tale about another bank:

They said although they loaned too much to people who couldn't pay them back that they deserve some of the bail-out money due to the cause being a bad Bush economy! They said they were too big in Fayette and Coweta County to fail!

Apparently the bank didn't make any investigation into whether or not the stuff they loaned the money for was needed--they just loaned it to developers who as everyone knows always pay.

Money must be easy to get nowadays. I remember having to show a banker so much paperwork and evidence of success that it turned out I didn't need the money even!

Bankers used to know what was going in their community, about business I mean, apparently now they count beans!

Spear Road Guy's picture
Submitted by Spear Road Guy on Mon, 08/03/2009 - 3:27pm.

How much ya want to bet the bad loans went to developers on the bank board or guys who were key investors?

Vote Republican


ptctaxpayer's picture
Submitted by ptctaxpayer on Mon, 08/03/2009 - 4:52pm.

Good Chuckle from the Bank of Georgia spinmeisters, there...LOL..."Yeah, the FDIC has it all wrong. There is no need for any of this... We're squeaky."

C'mon guys--- the FDIC is busy than a one-armed paperhanger and they not looking for unnecessary work.

I wish I was in the business of making vinyl banners. You know, the kind they hang over the old bank's sign when the takeover bank moves in.


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