Laughing to the Bank

Last month, I mentioned investors should look for short positions in public traded banks by looking at FDIC reports. On July 1, Habersham Bank received a “cease and desist” order. Unlike many cease and desist orders, this one came from Georgia Department of Banking and Finance instead of the FDIC. The order states that the bank must come up with a plan to maintain adequate capitalization. However, bank management claims they have more than sufficient liquidity. We shall see.

Disclosure: I am short HABC.