The bank, classified as "significantly undercapitalized," has been under an agreement with the FDIC since August 2010, but the capital plans the bank's management team has submitted have not been adequate, the FDIC said. The bank's condition has also gotten worse.
In the fourth quarter, the bank lost $3 million and its Tier 1 capital ratio remained below 3 percent, according to data from the FDIC.
"The bank’s management has not demonstrated the ability to return the Bank to a safe and sound condition," the new FDIC directive states.
The bank is now ordered to either find a buyer, sell new common stock, sell preferred stock, or receive direct contributions from the bank's directors or shareholders.