Sterling Bank & Trust Settles OCC Investigation into Advantage Lending Program; The OCC terminates the official agreement of June 2019

[ad_1]

SOUTHFIELD, Mich.–(BUSINESS WIRE)–Sterling Bancorp, Inc. (the “Company”) (NASDAQ: SBT), the savings holding company of Sterling Bank and Trust, FSB, Southfield, Michigan (the “Bank”), announced today that the Bank has entered into a Consent Order with the Office of the Comptroller of the Currency (the “OCC”), dated September 27, 2022 (the “Consent Order”), resolving the OCC’s formal investigation into the Bank’s former residential loan product, marketed as Advantage Loan Program and Related Matters. Under the Consent Order, the Bank agreed to pay a civil penalty of $6 million. The Civil Monetary Penalty will be applied to the previously accrued liability for contingent losses reflected in the Company’s Consolidated Balance Sheet, which amounted to $15 million as of June 30, 2022. The Consent Order represents a full and final settlement of the investigation of the OCC concerning the Bank.

Concurrently with the Consent Order, the OCC notified the Bank that the formal agreement between the Bank and the OCC entered into on June 18, 2019 (the “OCC Agreement”) has been terminated. The OCC Agreement primarily related to certain aspects of the Bank’s Bank Secrecy/Anti-Money Laundering Law compliance program and the administration of the Bank’s credit.

The Company and the Bank continue to be under investigation by the Department of Justice and the Securities and Exchange Commission regarding the Advantage Lending Program and related disclosures of this program in Company filings. under federal securities law. There can be no assurance that (i) the Company will not suffer material losses due to damages, penalties, costs and/or expenses as a result of such investigations; (ii) the remaining provision for any losses will be sufficient to cover such losses; or (iii) such losses will not materially exceed such accumulation and will have a material impact on the Company’s business, financial condition or results of operations.

“Today’s announcement from the OCC represents a painful resolution to the long-standing regulatory fallout from the ill-fated Advantage Loan Program. The level of cooperation we provided and the thorough internal investigation were essential in building a reputation with our regulators that we previously lacked. During my tenure as CEO, the Board, management and staff have placed this extensive cooperation as well as the correction of all critical findings in the OCC Agreement and elsewhere as our primary focus. Our commitment and ultimate success is evidenced by the termination of the OCC Agreement. As regulatory orders came in, our remedial actions were all accomplished in very quick order, especially given the severity of the findings and the rebuilding required. I think it’s an acknowledgment of the extraordinary efforts of the entire Sterling team. The $6 million civil penalty, while significant, is a clear reflection of our extraordinary cooperative and remedial efforts and represents another important step in eliminating these legacy issues.

Notwithstanding these accomplishments and as noted above, we remain engaged with the DOJ on the criminal aspects arising from the Advantage Lending Program. At this time, we have no visibility on the potential terms or timing of a settlement with the DOJ. We will continue to provide full cooperation and hope that a resolution with Sterling is imminent.

The Bank and the Company remain keen to put this whole episode behind them as quickly as possible. However, it is possible that the issues surrounding several individuals regarding their involvement in the fraud will continue well into the future,” said Thomas M. O’Brien, Chairman, President and Chief Executive Officer.

About Sterling Bancorp, Inc.

Sterling Bancorp, Inc. is a unit savings holding company. Its wholly owned subsidiary, Sterling Bank and Trust, FSB, has main branches in San Francisco and Los Angeles, California and New York. Sterling offers a range of lending products to the residential and commercial markets, as well as personal and business banking services. Sterling also has an operations center and branch office in Southfield, Michigan. For more information, please visit the Company’s website at http://www.sterlingbank.com.

Forward-looking statements

This press release contains certain statements that are, or may be deemed to be, “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934. as amended, regarding the Company’s plans, expectations, thoughts, beliefs, estimates, objectives and prospects for the future which are intended to be covered by the protections provided by the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect our current views with respect to, among other things, future events and our financial performance. These statements are often, but not always, made using words or phrases such as “may”, “could”, “should”, “could”, “predict”, “potential”, “believe”, “expect”, “assign”, “continue”, “will”, “anticipate”, “seek”, “estimate”, “intend”, “plan”, “project”, “goal” , “target”, “outlook”, “goal”, “would” and “annualized”, or negative versions of these words or other comparable words or expressions of a future or forward-looking nature. These forward-looking statements are not historical facts, and they are based on current expectations, estimates and projections about our industry, the beliefs of management and certain assumptions made by management, many of which, by their nature, are inherently uncertain. and beyond our control. Accordingly, we caution you that these forward-looking statements are not guarantees of future performance and are subject to risks, assumptions, estimates and uncertainties that are difficult to predict. The risks, uncertainties and other factors detailed from time to time in our public filings, including those included in the information provided under the headings “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors” in our Annual Report on Form 10 -K filed with the Securities and Exchange Commission on March 31, 2022, subsequent periodic reports and future periodic reports, could affect future results and events, causing such results and events to differ materially from the opinions expressed or implied in the Company’s forward-looking statements. Should one or more of the foregoing risks materialize, or should underlying assumptions prove incorrect, actual results or results may differ materially from those projected or implied by such forward-looking statements. Accordingly, you should not place undue reliance on these forward-looking statements. The Company undertakes no obligation to update, revise or correct any forward-looking statement based on the occurrence of future events, the receipt of new information or otherwise.

[ad_2]
Source link

Comments are closed.