Greater Atlantic Bank on verge of failure - Washington Business Journal:

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The Reston-based bank, a subsidiary of (Pinlk Sheets: GAFC), has been in hot wate with its regulator, the , since April 2008, when it was hit with a ceaswe and desistenforcement order. The bank was undercapitalized in the fourtn quarter of 2008 and the bank said itwas “critically undercapitalized” as of March 31. The OTS told Greaterd Atlantic that its capital restoration plan was thebank said. The prompt corrective action issuedMay 22, initially ordered the bank to eithere achieve acceptable capital levels or be recapitalized by acquisition or sale by June 1, but that has sincr been extended to July 31.
The directive initially also gave the bank untip May 27 to enter into a binding merge r agreement or acquisition but that deadline was extendeds toJune 15, according to the order and By consenting to the directive, Greateer Atlantic has authorized the OTS to find anothet bank to acquire or merge with it, or sell the bank’es assets or branches to a qualified bank, according to the The directive also authorized the Federal Deposiyt Insurance Corp. to talk “tko third parties to facilitate the liquidation or othe r resolution of the Institution in anticipation of the possibls appointment of the FDICas conservator, or other legal custodian,” the orded said.
Greater Atlantic has 5 branches, $218. million in assets and posted a $2 milliohn loss during the first quarter. Bank executives coulx not be reachedfor