Officials with CFBank, which as four Ohio branches including Fairlawn, said Friday that they have been released from an enforcement action by federal regulators.
In 2011, Central Federal Corp., the holding company for CFBank, entered into an agreement, called a “Cease and Desist” with the Office of Thrift Supervision, the primary regulator of the company.
When a group of investors bought the bank in 2012, it was coming off several years of large losses. Previous management at the bank had left in a resignation and retirement, and the bank had posted a loss every year but 2008 since 2003. The bank, founded in 1892, had commercial loans in difficulty and had become a victim of the recession, its leaders have said.
That Cease and Desist Order was terminated against CFBank, effective Thursday.
“We’re a free bank again,” said Central Federal and CFBank President Thad Perry in an interview. “We were able to prove to them that we know what we’re doing.”
In a prepared statement, Central Federal and CFBank Chief Executive Tim O’Dell said “the lifting of the CFBank Order reflects the improved capital position of CFBank. We have established a very good working relationship with the OCC and will continue to work closely with them as we continue to enhance our performance going forward, and reposition CFBank into a niche full-service business bank, focused on serving closely held businesses and the entrepreneurs that own them.”
Perry said the lifting of the order will also save the bank a lot of time and money since there are a lot of reports, restrictions and higher fees that a bank must adhere to when under an enforcement.
The bank should be able to have faster growth now, Perry said, including if it wants to go out and raise capital.
“We need to raise capital because we have a huge pipeline of loans. We increased our loans almost 60 percent last year in commercial loans. We have a great pipeline of great opportunities,” he said.
In other news, the holding company’s board of directors approved move of the parent company’s administrative offices to Columbus from Fairlawn. The Fairlawn CFBank is still the main and largest bank branch, said Perry. Executives spend their time among the branches in Columbus and Fairlawn and a new office opening on Monday with business bankers in Chagrin Falls.
In November, CFBank sold its Fairlawn building at Smith and Ghent roads to Westfield Bank. CFBank officials said they were looking for some capital to help them expand to Cleveland and they also had entered into an agreement for a former Citizens Bank branch location several hundred feet away with a drive-up window.
Westfield Bank moved from its West Market location to its new home on Jan. 21.
CFBank had to find a temporary home until May because FirstMerit, which bought Citizens and closed that branch, still had a lease agreement on the property and did not agree to lift the lease early, Perry said.
FirstMerit spokesman Rob Townsend was seeking comment on the lease and was not able to get an answer by the Beacon Journal’s deadline.
The temporary location is at 25 Ghent Road, also only a few hundred feet in the opposite direction from CFBank’s old building. It’s in a strip mall at Ghent Road and Crawfis Boulevard. Perry said the bank hopes to be in its permanent location by Memorial Day.
Betty Lin-Fisher can be reached at 330-996-3724 or blinfisher@thebeaconjournal.com. Follow her on Twitter at www.twitter.com/blinfisher and see all her stories at www.ohio.com/betty.