Speculation has swirled for months about whether Atlantic Bank would survive the fallout of the prolonged real estate downturn that began to take hold about five years ago.
The lender had been reeling from three back-to-back years of losses and was “critically undercapitalized,” federal regulators said in a statement Friday. Its 2011 first-quarter deficit totaled $4.4 million. The FDIC said Friday that Atlantic Bank was added to its “Problem Institution List” in February.
The lender began operating under a “cease-and-desist” supervisory order with the Office of Thrift Supervision in January after an examination last summer found “unsafe and unsound” practices.