Crisis Management

The Bank:

Hancock Bank & Trust Company (Hawesville, KY) received a public consent order from the FDIC and Kentucky Department of Financial Institutions in August 2013.

The Challenge:

The bank had 120 days to bring its Tier 1 Capital above 9% and its Total Risk-Based Capital Ratio above 13%, subject to certain restrictions regarding raising capital. In addition, the bank was entering a liquidity crisis where its correspondent banking relationships either significantly reduced or eliminated capacity to borrow. Legacy high cost of funds, a detriment to earnings, began to leave the tha bank in search of higher rates at competing banks.

The Solution:

Taylor Advisors worked quickly and diligently with the bank to address all the deficiencies mentioned in the consent order. This included creating a profit plan, a liquidity and contingency funding plan, and a strategic plan to address pricing policies, goals for asset growth and capital adequacy, forecasts to maintain a sound liquidity position. In addition to plan formation, Taylor Advisors was instrumental in executing the plans to manage through the liquidity and capital crisis.

The Outcome:

The consent order was terminated by the FDIC in January 2015.

A Word From The Client:

“I came here in 2013 and we were in trouble. I had made a career out of turning problem banks around, and they’ve all had liquidity issues. When I came to this bank, they had just recently brought on Taylor Advisors. Because of that, I had a working relationship with Omar, and it’s been exceptional. He is the best liquidity advisor I’ve ever worked with — and I’ve worked with about nine different banks. He has the practical on-the-job experience and the real-world knowledge he gained before he came into the advisory role. Just real good, practical stuff. I use Taylor Advisors for their liquidity skills, and I would especially recommend them to other financial institutions for their liquidity knowledge and skills.”          -Danny

For details on the performance of Taylor Advisors’ investment advisory clients, please contact us at at sasha@tayloradvisor.com or 502-412-2205.