Pikes Peak National Bank emerges from federal restrictions

Federal regulators have lifted lending and other restrictions imposed five years ago on Pikes Peak National Bank after the Colorado Springs institution reduced its problem loans last year by nearly half.

The U.S. Comptroller of the Currency's Office released Pikes Peak National from the order to reduce its problem loans on April 1, saying the bank had returned to "safe and sound operation." The order also required the bank to come up with a program to improve its credit-risk management and administration, better document collateral and credit information on all loans, adopt stronger policies on real estate appraisals, hire a consultant to review its loan portfolio and appoint a board committee to monitor compliance with the order.

"This is the best letter I have ever held in my hand," Pikes Peak National President Robin Roberts said Tuesday. "It has been five years of regulatory action; I'm glad it's over and we are never going back to where we were."

Roberts said the bank plans to add cash management and remote deposit services later this year, since it can redirect personnel who had been working on meeting the order's requirements to offering the new services.

Pikes Peak National becomes the second local bank to be released from similar orders from regulators. Peoples Bank was released in 2012 from an order from the comptroller's office requiring it to reduce delinquent loan levels and boost capital and reserves for potential loan losses.

Academy Bank of Colorado Springs, Park State Bank of Woodland Park and Rocky Mountain Bank & Trust of Florence remain under such orders, but they're making progress in reducing problem and delinquent loans, according to reports from the Federal Deposit Insurance Corp.

"We had several banks come under this agreement, and all but one (Colorado National Bank) survived. That says a lot about the management of those institutions," Roberts said. "As more institutions emerge from these orders it enhances the industry's ability to meet the needs of the community."

Under its order, Pikes Peak National had restrictions on lending and dividend payments. The bank also was required to come up with about $500,000 in additional capital, develop a three-year turnaround plan, add two members to its five-person board and hire a senior lending officer.

The comptroller's office imposed the order after the bank's delinquent loans surged to nearly 19 percent of its portfolio in 2010. By the end of last year, the bank had cut delinquent and other problem loans to less than 5 percent of its portfolio.

"It was four years of a lot of work; our employees worked really hard to meet all of the requirements of the order. We thank all of our employees and customers for supporting us and we look forward to continuing to help small businesses be successful because that is our primary focus."

Pikes Peak National, owned by Earl Georgeson of Colorado Springs, had assets totaling $81 million as of March 31. The bank, based in Old Colorado City, employs 35 and operates three branches.

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