The Federal Reserve Board on Thursday announced an enforcement action against Farmington State Bank, of Farmington, Washington, and its holding company, FBH Corporation. In 2022, Farmington improperly changed its business plan without notifying the bank's supervisors and obtaining prior approval for those changes. Farmington has previously announced that it will voluntarily sell its loans and deposits to the Bank of Eastern Oregon.
The Board's action ensures the bank's operations will wind down in a manner that protects the bank's depositors and the Deposit Insurance Fund. The action also prohibits Farmington and FBH from making dividends or capital distributions, dissipating cash assets, and engaging in certain activities without approval from its supervisors.
The action is being taken jointly with the Washington State Department of Financial Institutions, the state supervisor of Farmington.
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