FDIC issues ‘cease and desist’ order on CB&T

Due to problems stemming from bad loans made by the Barrow County branches of Community Bank & Trust, the federal FDIC released a “cease and desist order” against the firm Friday.

The order, dated May 11, 2009, slams 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.”

According to those close to the situation, the problems are a result of lax loan practices in Barrow County where the bank has offices in Winder, Bethlehem and Auburn.

The 29-page order lists a long series of activities the bank will now have to do, including raising additional capital, reclassifying bad loans, and strengthening board and management practices.

The bank, which has assets of $1 billion-plus, is based in Habersham County and has branches throughout Northeast Georgia, as well as a smaller number in West Georgia and East Alabama.