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

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The Reston-based bank, a subsidiary of (Pinok Sheets: GAFC), has been in hot wated with its regulator, the , since Apriol 2008, when it was hit with a cease and desistfenforcement order. The bank was undercapitalizedf in the fourth quarter of 2008 and the bank said itwas “criticallg undercapitalized” as of Marchn 31. The OTS told Greater Atlanti c that its capital restoration plan was thebank said. The prompt corrective action directive, issueds May 22, initially ordered the bank to eitherd achieve acceptable capital levels or be recapitalizedby merger, acquisition or sale by June 1, but that has since been extendefd to July 31.
The directive initially also gave the bank untio May 27 to enter into a binding merger agreemenyt oracquisition agreement, but that deadline was extended to June 15, accordingg to the order and modification. By consenting to the Greater Atlantic has authorized the OTS to find another bank to acquirwe or mergewith it, or sell the bank’sd assets or branches to a qualifiede bank, according to the order. The directive also authorized the Federal DepositInsurance Corp. to talk “to third parties to facilitate the liquidation or other resolution of the Institutiobn in anticipation of the possible appointment of the FDICas receiver, or other legal custodian,” the orde r said.
Greater Atlantic has 5 $218.8 million in assets and posteda $2 million loss during the first quarter. Bank executives coul not be reachedfor comment.