Uncontrollable Phrase! Illinois Bank Hit with Painful Rating Downgrade

MJP –

The most recent performance reports for an Illinois bank have resulted in a very low grade according to OCC criteria.

From July 1, 2024, through July 31, 2024, a list of publicly available Community Reinvestment Act (CRA) performance ratings was issued by the Office of the Comptroller of the Currency (OCC).

This list exclusively includes rated national banks, FSAs, and insured federal branches of international banks.

Outstanding, satisfactory, requires improvement and serious noncompliance are the possible grades.

One evaluation was deemed to be in substantial noncompliance out of twenty-seven that were made public this month; twenty-one were deemed satisfactory, and six were deemed outstanding.

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Only Lemon National Bank in Ohio was deemed to have a significant lack of compliance.

This rating was backed by the following significant factors:

• The average quarterly loan-to-deposit ratio (LTD) of 10.6% for the bank is irrational.
• There has to be an uptick in lending within the AA evaluation region. During the three-year assessment period, the bank originated six loans in the AA.
• Loans are not fairly distributed among borrowers with varying income levels.
• During the review period, Lemont did not receive any complaints about its CRA performance.

The OCC investigation stated that the bank’s loan-to-deposit ratio is inappropriate, taking into account the bank’s size, financial situation, and the credit needs of the AA(s).

“Please send me emails and targeted advertisements. I agree.”Over the sixteen quarters after the previous CRA assessment, Lemont National Bank’s LTD averaged 10.6%.

The average LTD ratio for the bank was between 9.7 and 11.0 percent.

Similarly sized financial institutions with assets less than $100 million had an average LTD ratio of 77.8%.

The ratio varied between 63.4% and 116.2%.

Situated about 20 miles southwest of Chicago, the village of Lemont, Illinois is home to the headquarters of Lemont, a nationally chartered bank.

Another Lemont, Illinois-based financial institution, Lemont Bancorp Inc., owns 100% of Lemont.

Total assets were $65.4 million, total deposits were $47.0 million, and tier 1 capital was $3.6 million as reported by Lemont as of December 31, 2023.

There is just one state-run bank in Cook and Will counties, but it has five convenient locations.

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