OCC Orders Mountain View Bank to Improve Capital, Management

The chief regulator of national banks has ordered Ozark Heritage Bank of Mountain View to improve its capital ratios and its management team.

The order, which the bank's board of directors agreed to, was signed on Aug. 26 but was not made public until Friday.

Ozark Heritage is the former National Bank of Altheimer —the smallest bank in the state until it was sold to a group of investors and its charter moved to the Stone County seat.

"The situation was that when we opened our office here in Mountain View that we grew so fast that we just outgrew management, and that created some issues that were of concern to the OCC," CEO James R. "Ron" Sims told ArkansasBusiness.com Friday afternoon.

The Bank of Altheimer had about $12 million in assets when it was sold on March 31, 2009. As of June 30 of this year, its assets had grown to $66.2 million. That growth has left the bank's leverage capital at 7.24 percent of assets, according to Sims; the OCC order requires the bank to up its leveraged capital ratio to 9 percent.

The bank, which had $6.4 million in equity capital as of June 30, already has about 200 investors, Sims said. Another stock offering to raise additional capital is likely, he said.

The OCC's order also requires the bank to hire more experienced bankers, and Sims said the board of directors was doing that even before the order — starting with the hiring in February of Sims, who had 39 years of banking experience. He formerly worked for the Bank of Mountain View (now part of Centennial Bank of Conway) and most recently with First Security Bank in Mountain View.

Among other new hires is Nick Roach, who came from Central Bank in Little Rock about a month ago, Sims said.

"When you are shorthanded, you know what happens sometimes," he said. "Financially, we're safe and sound. Most of our weaknesses are in our documentation, but we're actively addressing all the issues that are out there."

He said the OCC had been helpful with advice on better management.

Ozark Heritage lost $1.09 million in 2009 and another $103,000 in the first two quarters of 2010, but Sims said the bank had been profitable for the past couple of months.