Forbright Bank, based in Maryland, has recently resolved an order from the Federal Deposit Insurance Corporation (FDIC) regarding the reliability of its funding sources. The FDIC had reprimanded the bank last year due to its use of brokered deposits, which are often seen as less stable forms of funding.
In response to the FDIC’s concerns, Forbright Bank has taken proactive steps to address the issue. One of the key measures the bank has implemented is the expansion of its digital banking arm. By enhancing its digital capabilities, Forbright Bank aims to attract more stable deposits and reduce its reliance on brokered funding.
The move towards digital banking is part of Forbright Bank’s broader strategy to ensure a more secure and sustainable funding base. By diversifying its funding sources and focusing on more stable deposit channels, the bank aims to strengthen its financial position and mitigate risks associated with volatile funding streams.
This development underscores the importance of financial institutions maintaining reliable and secure funding sources. The FDIC’s scrutiny of Forbright Bank highlights the regulatory focus on ensuring the stability and resilience of banks in the face of potential funding challenges.
Overall, Forbright Bank’s resolution of the FDIC order demonstrates its commitment to addressing regulatory concerns and enhancing its financial stability. By prioritizing the reliability of its funding sources, the bank is taking proactive steps to strengthen its operations and build a more resilient banking platform.
References:
– The Latest. (Link: https://www.americanbanker.com/news/fast-growing-bank-resolves-order-over-reliability-of-funding)
