FDIC issues ‘cease and desist’ order on CB&T; Habersham Bank under ...

The FDIC released a 29-page “cease and desist” order last Friday against Community Bank and Trust that was dated May 11. CB&T is headquartered in Cornelia and operates multiple divisions in Northeast Georgia, including Barrow and Jackson counties.

On Monday, Habersham Bancorp, based in Clarkesville, announced it had signed a less severe “cease and desist” order with the Georgia Department of Banking, according to Reuters. Habersham Bank operates a branch in Braselton, among other North Georgia locations. (Earlier reports misidentified the Habersham order as being with the FDIC rather than the state.) Habersham Bancorp president David Stovall said the bank is healthy and well-capitalized.

The CB&T order released last week slammed the bank’s board of directors and management, saying “the Bank had engaged in unsafe or unsound banking practices and had committed violations of law and/or regulations.”

Some sources from CB&T said that the problems are a result of lax loan practices primarily in Barrow County where the bank has offices in Winder, Bethlehem and Auburn.

But Barrow division president Randy Sims said the issues the bank faces are larger than just Barrow County.

“We’ve addressed all the issues here and company wide and feel good about where we’re headed,” he said. “We’re moving in the right direction.”

For the full story, see the July 1 issue of the Barrow Journal.