Fed tells Florida bank to raise capital or find buyer

WASHINGTON, March 9 (Reuters) - The Federal Reserve Board said on Tuesday that Bradenton, Florida-based Horizon Bank has failed to file an adequate capital restoration plan and ordered it to sell shares or find a buyer within 45 days.

The Fed said the "prompt corrective action" order was issued after the state-chartered bank was declared undercapitalized on July 30, 2009, and it did not submit an acceptable capital restoration plan.

The Fed in the order said the bank and its parent firm, Horizon Bancorporation Inc (HZNB.OB) must take, within 45 days, necessary measures to make the bank adequately capitalized, by increasing the bank's equity through the sale of shares or contributions to surplus, or enter into and close a contract to be acquired by a depository institution holding company or combine with another insured depository institution.

The order also said the bank must fully comply with restrictions on capital distributions, including payment of dividends.

Within 30 days, Horizon Bank also must submit an acceptable plan and timetable to the Federal Reserve Bank of Atlanta for conforming interest rates paid on all existing non-time deposit accounts to the prevailing effective rates on insured deposits of comparable amounts in the bank's market area. (Reporting by David Lawder; Editing by Neil Stempleman)