Town's Friendly Bank Left Nasty Mess
Despite growing from $1 billion in assets in July 2006 to $2 billion in January 2008, state regulators shut down the community bank New Frontier Bank in northeast Colorado on April 10. Thirty-five percent of the bank's loan portfolio was delinquent due to their too-loose credit requirements, leading regulators to fear future losses. In effect, many business-owning borrowers cannot find new credit lines or refinance loans, forcing them to fall behind on home and business loans, cut staff, order less from and delay payments to suppliers, and close for business.
Source: WSJ.com | June 16, 2009