Since your mother has passed, a power of attorney means nothing. A power of attorney is for a living person who wants to name an agent to act for them - usually if they become incapacitated. So the bank is wrong. If this account was in mom's name alone, it would have to go through probate in some fashion - most states have small estate procedures for accounts this small (if there are other accounts that add up to more that might not be the case). The other issue to consider is if there is any debt - if there is it may not be worth it to even open the estate. The probate office in most counties can help out on something this small and offer you some help.
This is not legal advice nor intended to create an attorney-client relationship. The information provided here is informational in nature only. This attorney may not be licensed in the jurisdiction which you have a question about so the answer could be only general in nature. Visit Steve Zelinger's website: http://www.stevenzelinger.com/
As Mr. Zelinger stated, a power of attorney (even if she executed one prior to her passing) is not effective after the death of the grantor and so you cannot use one to gain access to the funds in her account.
However, if she did not owe any debts, then you can file a small estate affidavit to obtain authority to receive the funds. This is a simple, very informal procedure.
This response is for information purposes only, it does not create any attorney-client relationship. Responses to questions posted on this Forum are of a general nature only. Because it is not possible to have all of the facts of your issue addressed in this forum, you should consult with an attorney to review the unique circumstances specific to your situation. www.TheSchollLawFirm.com