AJC: Feds file another lawsuit over a failed Georgia bank

From today’s AJC:

The Federal Deposit Insurance Corp. accuses the executives and directors of of Alpha Bank & Trust of sloppy lending practices and strategy focused on “growth above all else, including safety and soundness,” according to a lawsuit filed Friday in U.S. District Court in Atlanta.

The lawsuit seeks $23.9 million in damages.

Alpha Bank failed in October 2008, only about 30 months after it opened, and was one of the early casualties of the economic collapse.

Georgia leads the nation with 70 failures since mid-2008. This is the fourth liability lawsuit filed by regulators seeking damages from bank insiders.

30 months. That’s how long the bank was even open. That $23.9 million in damages represents only a little more than a tenth of the total cost of the failure.

As I’ve said repeatedly (including here a month ago), it is incumbent on Georgia’s leaders to get to the roots of our state’s banking crisis. What failures of policy and/or enforcement led us to this position of having more failed banks than any other state?

There might be a glimmer of good news for Georgia banks. It’s been over a month since the FDIC has shut down a bank in the state. And the pace of failures has slowed this year, as you can see in the following graph from Calculated Risk: