Tioga-Franklin Savings Bank failed after expanding its mortgage lending business: FDIC Office of Inspector General

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The FDIC Office of Inspector General determined that Tioga-Franklin Savings Bank failed due to the high costs of expanding its mortgage lending business. Its subsequent weak profitability led to liquidity and capital problems, and the bank was unable to find new investors to stabilize its finances. The bank failed in August, and the FDIC estimated the loss to the Deposit Insurance Fund at $5,445,000, or approximately 8% of the bank’s total assets.