The Tracy Press in a story Saturday misstated aspects of a “written agreement” between bank regulators and Pacific State Bank of Stockton, as well as the health of the bank itself.

The agreement was entered into Feb. 18, the document shows, with Pacific State Bank’s board of directors and the Federal Reserve Bank of San Francisco and the California Department of Financial Institutions.

The 12-page agreement covers a wide range of topics about how the bank manages its risk, assets, loans and other parts of the bank’s financial affairs.

According to the Federal Reserve Board’s Web site, “written agreements are normally exercised when banks have serious problems.”

Repeated attempts to interview Pacific State Bank President Ricky D. Simas, either for this story or the previous story, were not returned. Simas called Press Publisher Bob Matthews about the errors in the story Monday.

Pacific State Bank attorney Jeffrey Tisdale of the Los Angeles-based firm Tisdale and Nicholson LLP agreed in a letter sent to the Tracy Press on Tuesday that the bank is “experiencing challenges resulting from the devaluation of real estate collateral securing many loans,” but he characterized certain descriptions in the story about the health of the bank as inaccurate and irresponsible.

Tisdale said written statements in the Press that the bank is “staggering,” descending toward “insolvency,” “critically close to failure” and trying to save itself from “total subsistence on government life support,” or that it needs permission from its board to issue new loans, are “patently false” and “highly inflammatory.”

The written agreement says nothing about prohibiting the bank from making new loans.

Tisdale also called false a statement in the story that the bank is “close to the point of having lost so much in assets through bad loans that it can’t turn around and lend that money out again.”

Among other things, the written agreement restricts the bank from changing the terms of existing loans criticized by bank regulators last year, without “prior approval of a majority of the full board of directors” or its designated subcommittee.

It also directs the bank to come up with a plan to “improve the bank’s position” on loans or assets greater than $500,000.