Banking

Eagle Bancorp to settle another shareholder lawsuit

Eagle Bancorp has agreed to settle a class-action lawsuit alleging that the Bethesda, Md., company had lacked sufficient internal controls under its previous management.

The $11.1 billion-asset Eagle disclosed in a press release Wednesday that it would pay $7.5 million in exchange for a release of all claims against the company and current and former executives. Eagle and the executives did not admit or deny wrongdoing as part of the settlement, which resulted from nonbinding mediation that concluded in mid-April.

The settlement addressed a shareholder lawsuit filed in the U.S. District Court for the Southern District of New York.

Eagle said the agreement is subject to final documentation, court approval and other customary conditions. The company said it expects that the full amount of the settlement to be paid by its insurance carriers under applicable policies.

Eagle in January moved to settle a shareholder demand letter by agreeing to spend $2 million to enhance its corporate governance and to pay $500,000 in attorney’ fees. Court approval for that settlement is pending until a hearing set for May 12.

Eagle has been grappling with a series of probes into its treatment of related-party transactions and ties to a Washington councilman accused of ethics violations.


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