Giannoulias bank under federal scrutiny
State Treasurer Alexi Giannoulias’ family-owned Broadway Bank has entered into a consent decree with federal and state regulators to keep the bank running.
Independent rating agencies have listed the bank as among the most troubled of its size in Illinois.
Giannoulias and bank officials have denied allegations from David Hoffman, a rival in the Democratic U.S. Sen- ate primary race, that Broadway is more leveraged with risky loans than most community banks.
The consent decree entered into Tuesday requires Broadway to raise about $50 million in new capital and add at least $19 million to its reserves for loan losses within 10 days.
It also must sell off problem assets and improve operations and management systems under the review of the Federal Deposit Insurance Corp. The FDIC still guarantees accounts but now must approve all significant decisions. The bank also must hire an outside party to evaluate senior management.