Five small Georgia banks have joined the long list of state financial institutions under pressure from regulators to improve their finances and operations.

The banks – one in Stockbridge, the others in north and middle Georgia – must boost their capital levels and take a host of other steps to shore up their balance sheets, including reducing the number of bad loans on their books.

The orders were issued last month but made public on Monday by the Federal Deposit Insurance Corp.

The banks are: First Bank of Dalton; Bank of Ellijay; Piedmont Community Bank, Gray; Northwest Georgia Bank, Ringgold; and High Trust Bank, Stockbridge.

The banks, like so many across the state, lent heavily in the real estate sector only to see defaults skyrocket amid the recession.

About one-third of Georgia’s more than 300 banks face increased regulatory scrutiny amid the worst banking crisis in at least a generation.

“It is a challenging time for our entire nation, and we are eager to work with the regulatory authorities in ensuring the safety and soundness of this institution,” Robert Drew Hulsey Jr., CEO of Piedmont Community, said in a prepared statement.

The five banks represent a cross-section of the state’s community banking industry. The youngest, Bank of Ellijay, was founded in 2006, while the oldest, Northwest Georgia Bank, is more than 100 years old.

The smallest, Bank of Dalton, has just $130 million in assets. Northwest Georgia is the biggest at $586 million in assets.

Each is suffering from a portfolio sagging under the weight of bad loans. Piedmont Community, for example, has $26 million in severely delinquent loans, compared to just $6 million a year ago.

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