Friday, June 19, 2009

Cherokee Bank Enters Into Agreement With Regulator

/PRNewswire/ -- Cherokee Banking Company (OTC:CHKJ) (BULLETIN BOARD: CHKJ) , the holding company of Cherokee Bank, N.A., today announced that the bank has signed an agreement with the Comptroller of the Currency aimed at solving issues related to the downturn in the economy and housing market. The "Consent Order" primarily outlines actions to improve the bank's capitalization and credit quality.

"In response to the collapse of the housing and real estate markets, we proactively initiated our own strategic plan in June 2008 aimed at ensuring that we remain a safe and sound institution," said Dennis Burnette, president and chief executive officer. "The actions in our plan are aligned with the requirements in the Consent Order, primarily, increasing our capital ratio over and above our level at March 31, 2009, which was categorized as 'well-capitalized', as well as maintaining an adequate level of liquidity and reducing our problem assets. We plan to continue progressing along the path toward the benchmarks we have established and look forward to continuing to work closely with our regulator to do so."

One benchmark calls for the company to achieve a minimum Total Risk-Based capital ratio of 12 percent and Tier 1 capital ratio of at least 8 percent. The company already has undertaken a three-year strategic plan aimed at achieving these levels.

The agreement has no impact on deposit and retirement accounts, which continue to be insured for a minimum of $250,000 per depositor by the FDIC through December 2009. Additionally, most types of business checking accounts are insured without limit due to Cherokee Bank's participation in the FDIC's Transaction Account Guarantee Program.

"As we complete the processes outlined in the agreement, we will continue to operate as normal, providing friendly, personalized service to our clients," said Burnette.

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