The number of troubled Georgia banks grew to 64 at the end of last year, as the state's banking crisis shows no sign of abating.
That's up from 57 in the third quarter and 49 in the second quarter, based on a measure of bank health known as the "Texas ratio."
The Texas ratio measures a bank's problem loans against its capital on hand to absorb losses. While regulators don't release an official list of troubled banks, the Texas ratio serves as an informal misery index that circulates widely among bankers and analysts.
A ratio of 100 or more means a bank has more problem loans than capital on hand to absorb losses. Topping Georgia’s list: tiny McIntosh Commercial Bank in Carrollton. McIntosh had a ratio of 884, one of the highest in the nation, according to Atlanta-based FIG Partners, a bank consulting firm.
The bank, established in 2002, was growing fast and earning more than $1 million a year by 2006. Less than 2 percent of its loans were in distress.
By the end of 2009, however, the picture for McIntosh and most other Georgia banks had changed drastically amid a deep recession and collapsed housing market.
McIntosh, which bet heavily on real estate during the boom like many Georgia banks, reported heavy losses in 2009 and ended the year with nearly half of its loans in some stage of delinquency.
In all, 16 Georgia banks joined the list in the fourth quarter and eight others fell off because they failed.
Having a Texas ratio above 100 does not mean a bank will fail. Many banks with high ratios are able to shore up their bottom lines by selling bad loans and raising new capital.
That’s a strategy being pursued by Decatur First Bank, which joined the list in the fourth quarter with a Texas ratio of 133 percent. The bank has been selling foreclosed properties and plans to raise between $5.5 million and $10 million, said Judy Turner, the bank’s CEO.
“I hope this is a fluke and we’ll be off [the list] at the end of the first quarter,” she said. “But there are economic conditions that I cannot control or predict.”
But it’s not an easy process, said Chris Marinac, a FIG Partners research analyst, as . investors are wary of putting money into troubled banks.
Meanwhile, real estate prices remain depressed, forcing banks to take losses when the foreclose on or sell properties.
“The way you get out of it is having a better economy that lifts prices for real estate, which we haven’t seen yet,” Marinac said.
Here are Georgia banks with Texas ratios above 100.
The bank is followed by its location, the ratio in the fourth quarter vs. third quarter.
McIntosh Commercial Bank, Carrollton: 884, 592
Century Security Bank, Johns Creek: 746, 474
Appalachian Community Bank, Ellijay: 563, 398
First Commerce Community Bank, Douglasville: 447, 380
First State Bank, Stockbridge: 433, 244
Bank of Hiawassee Bank, Hiawassee: 410, 257
Habersham Bank, Clarkesville: 383, 269
North Georgia Bank, Watkinsville: 368, 292
Gordon Bank, Gordon: 362, 231
Montgomery Bank & Trust, Ailey: 358, 215
Security Exchange Bank, Marietta: 353, 280
First National Bank, Savannah: 350, 161
American Trust Bank, Roswell: 329, 208
Chestatee State Bank, Dawsonville: 317, 261
Douglas County Bank, Douglasville: 311, 237
Bank of Ellijay, Ellijay: 296, 152
Unity National Bank, Cartersville: 248, 198
High Trust Bank, Stockbridge: 241, 211
First Cherokee State Bank, Woodstock: 240, 208
Gwinnett Community Bank, Duluth: 237, 225
Enterprise Banking Co., McDonough: 236, 158
Northwest Bank & Trust, Acworth: 233, 228
Sunrise Bank of Atlanta, Atlanta: 226, 124
Crescent Bank & Trust, Jasper: 225, 129
Hometown Community Bank, Braselton: 225, 244
Providence Bank, Alpharetta: 224, 126
McIntosh State Bank, Jackson: 215, 172
Satilla Community Bank, St. Marys: 210, 82
Piedmont Community Bank, Gray: 209, 192
Peoples Bank, Covington: 202, 192
Darby Bank & Trust, Vidalia: 201, 137
Park Avenue Bank, Valdosta: 196, 99
Peoples Bank, Winder: 189, 118
First Citizens Bank of Georgia, Dawsonville: 179, 105
Peoples Bank & Trust, Buford: 178, 185
Patriot Bank of Georgia, Cumming: 173, 127
Citizens Bank of Effingham, Springfield: 171, 25
Farmers & Merchants Bank, Lakeland: 167, 120
Heritage Bank, Jonesboro: 166, 138
Piedmont Bank, Lawrenceville: 165, 75
Community Bank & Trust, LaGrange: 161, 155
Northside Bank, Adairsville: 159, 124
Community Capital Bank, Jonesboro: 157, 139
Atlantic Southern Bank, Macon: 155, 110
First National Bank, Barnesville: 153, 143
WestSide Bank, Hiram: 152, 131
Legacy State Bank, Loganville: 145, 139
CreekSide Bank, Woodstock: 142, 125
Mountain Heritage Bank, Clayton: 141, 116
Central Bank of Georgia, Ellaville: 134, 85
Decatur First Bank, Decatur: 133, 84
New Horizons Bank, East Ellijay: 126, 80
Peoples Community National Bank, Bremen: 123, 197
Citizens State Bank, Kingsland: 122, 56
Georgia Heritage Bank, Dallas: 120, 99
Farmers Bank, Forsyth: 119, 102
Bank of Newington, Newington: 118, 76
Oglethorpe Bank, Brunswick: 117, 50
First National Bank, Griffin: 116, 130
Bartow County Bank, Cartersville: 114, 99
PlantersFirst, Cordele: 114, 98
Jasper Banking Co., Jasper: 112, 61
First National Bank, Chatsworth: 106, 64
Eastside Commercial Bank, Conyers: 105, 108
Source: FIG Partners
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