NEW YORK (TheStreet) -- The Bancorp (TBBK) shares are down dramatically, -30.3% to $11.29, after the bank entered into a Stipulation and Consent to the Issuance of a Consent Order with the FDIC.
The order became effective on June 5 and requires the bank to correct the weaknesses in its Bank Secrecy Act Compliance Program.
Analysts at BTIG and Sterne Agee both downgraded the bank's shares to "neutral" from "buy" today following the news.
"Insofar as our bullish thesis on TBBK was based in large part on growth generated by the launch of new prepaid card programs, we are moving to the sidelines for now until we gain more clarity on when the restrictions on the company may be lifted," said analysts at BTIG.
The bank entered into the consent order without admitting or denying FDIC charges of unsafe banking practices.
TheStreet Ratings team rates BANCORP INC as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:
"We rate BANCORP INC (TBBK) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, expanding profit margins and increase in stock price during the past year. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and premium valuation."