Indiana Community Bank Farmers and Mechanics Hit With Consent Order After Years of Losses

Farmers and Mechanics Federal Savings Bank is an Indiana community bank serving local depositors and small and medium-sized businesses. It has posted continuous losses since 2020, reflecting pressure on its management of revenue, costs and asset quality. Its capital buffer for absorbing losses has also become a regulatory focus.

The Federal Deposit Insurance Corporation, or FDIC, and Indiana regulators recently entered into a consent order with the bank requiring its board to develop and implement a plan to restore profitability. The order also requires the bank to maintain a risk-based capital ratio of at least 12% to improve its financial performance and the adequacy of its capital and assets.