Syringa Bank works to beef up its finances
Published: August 20, 2012
By Bill Roberts
Syringa Bank is working to improve its financial health three months after regulators gave it 90 days to boost its capital level or face putting itself up for sale.
“Are we satisfied with the bank’s efforts? We certainly are,” said Mary Hughes, financial institutions bureau chief for the Idaho Department of Finance, one of Syringa’s regulators.
In May the Federal Deposit Insurance Corp. issued an order telling Syringa to make improvements. But that order doesn’t mean there are automatic repercussions if the bank doesn’t meet regulators requirements, Hughes said.
“We are working very closely with them.”
Syringa Bank was hard-hit with problem loans as the housing market tanked in the Treasure Valley during the recession. The May order was the second received by the bank. In 2010, regulators told Syringa to beef up its Tier 1 capital — the ratio of a bank’s equity to loans and other assets — and reduce its problems loans.
Regulators want the bank’s capital level at 13 percent. It is now at 3.9 percent.
Syringa has $10.7 million in an escrow account — most of it from one investor — that can help the bank by both increasing capital levels and selling off problem loans once the bank can meet a set of requirements that officials won’t disclose, said Scott Gibson, Syringa Bank president and CEO.
Meanwhile, Syringa has sold off many of its problem loans and reduced the number of loans not accruing any interest from $9 million a year ago to $3.7 million in June.
Once Syringa can access the $10.7 million, it will be able to boost its capital level beyond 10 percent, which regulators consider well capitalized, Gibson said.
Syringa is based in Boise and has locations in Meridian, Eagle, Middleton and Lewiston.
