List of troubled Georgia banks grows

The troubles appear to be escalating at some of the hardest-hit banks as problem loans soar and capital erodes, causing their Texas ratios to climb sharply. Many of the 14 new banks on the list at the end of the third quarter are in north and middle Georgia, suggesting the crisis is spreading from its roots in metro Atlanta.

The Texas ratio is widely used in the industry to gauge an institution’s problems. When the measure tops 100, that means a bank has more problem loans than capital on hand to absorb losses. Critics downplay the importance of the ratio, saying it’s an incomplete yardstick that doesn’t take into account a bank’s ability to address the problems.

Since Georgia's banking crisis hit in 2008, 25 banks have failed, the most in any state. Most of those banks had high Texas ratios.

Topping the list of 57 Georgia banks in the third quarter: RockBridge Commercial Bank, a small Atlanta lender, with an eye-popping Texas ratio of 1,144 percent – a nearly 10-fold increase from the second quarter.

RockBridge lost $28 million in the third quarter, ending with just $1.5 million in equity capital left on its books, according to the bank’s latest regulatory filing. RockBridge officials did not return a call seeking comment.

Only one bank nationwide had a higher Texas ratio than RockBridge: Valley Capital Bank in Arizona. Of the banks with the nation's 10 highest Texas ratios, six are based in Georgia.

Most of the new Georgia banks on the list are tiny lenders, though two have assets of about $1 billion: Darby Bank & Trust of Vidalia; and Atlantic Southern Bank of Macon. Atlantic Southern president Ed Loomis said the bank is considering a capital raise to help shore up its finances, which have been knocked around by the distressed housing market as well as losses on commercial real estate loans.

Loomis said the bank stayed out of the metro Atlanta market, which has seen the largest real estate problems. “We primarily stayed in middle Georgia and coastal Georgia, where our offices are located. Those markets have not been as healthy as they typically are, but they have not suffered the problems that occurred” in suburban Atlanta.

Mountain Heritage Bank, which joined the troubled list in the third quarter, is trying to raise money and shrink its balance sheet. Such moves should improve its Texas ratio, which stood at 116 percent in the third quarter.

Jim Wallace, Mountain Heritage's president and CEO, said the bank did not lend heavily to subdivision developers and home builders buying vacant housing lots, like so many metro Atlanta banks. Its losses are mainly tied to loans made for the construction of retirement homes and second homes, a market that largely dried up during the recession.

“We’re just trying to fight through and put one foot in front of the other,” Wallis said.

Georgia has more banks with Texas ratios above 100 percent than any other state:

Georgia      57

Florida        43

Illinois        29

Minn.           21

Wash.          17

The problem bank list

Georgia’s roster of troubled banks grewt from 49 to 57 during the third quarter, as measured by the “Texas ratio.” A score of more than 100 means that a bank has more problem loans and foreclosed property than capital on hand to cover potential losses.

Bank Location 3rd quarter score

RockBridge Commercial Bank Atlanta 1144%

First Security National Bank Norcross 868%

Buckhead Community Bank Atlanta 711%

McIntosh Commercial Bank Carrollton 592%

First National Bank of Georgia Carrollton 480%

Century Security Bank Duluth 474%

United Security Bank Sparta 440%

Appalachian Community Bank Ellijay 398%

Tattnall Bank Reidsville 397%

Community Bank & Trust Cornelia 383%

First Commerce Community Bank Douglasville 380%

North Georgia Bank Watkinsville 292%

Security Exchange Bank Marietta 280%

Habersham Bank Clarkesville 269%

Chestatee State Bank Dawsonville 261%

Bank of Hiawassee Hiawassee 257%

First State Bank Stockbridge 244%

Hometown Community Bank Braselton 244%

Douglas County Bank Douglasville 237%

Gordon Bank, The Gordon 231%

Northwest Bank & Trust Acworth 228%

Gwinnett Community Bank Duluth 225%

Montgomery Bank & Trust Ailey 215%

High Trust Bank Stockbridge 211%

First Cherokee State Bank Woodstock 208%

American Trust Bank Roswell 208%

Unity National Bank Cartersville 198%

Peoples Community National Bank Bremen 197%

Peoples Bank Covington 192%

Piedmont Community Bank Gray 192%

Peoples Bank and Trust Buford 185%

McIntosh State Bank Jackson 172%

First National Bank Savannah 161%

Enterprise Banking Company Mcdonough 158%

Community Bank & Trust -- West Georgia LA Grange 155%

Bank of Ellijay Ellijay 152%

The First National Bank of Barnesville Barnesville 143%

Community Capital Bank Jonesboro 139%

Legacy State Bank Loganville 139%

Heritage Bank Jonesboro 138%

Darby Bank & Trust Co. Vidalia 137%

WestSide Bank Hiram 131%

First Covenant Bank Norcross 130%

First National Bank of Griffin Griffin 130%

Crescent Bank and Trust Company Jasper 129%

Patriot Bank of Georgia Cumming 127%

Providence Bank Alpharetta 126%

Creekside Bank Woodstock 125%

Northside Bank Adairsville 124%

Sunrise Bank of Atlanta Atlanta 124%

Farmers & Merchants Bank Lakeland 120%

Peoples Bank Winder 118%

Mountain Heritage Bank Clayton 116%

Atlantic Southern Bank Macon 110%

Eastside Commercial Bank Conyers 108%

First Citizens Bank of Georgia Dawsonville 105%

Farmers Bank Forsyth 102%