77 Banks Down - GFG #78?

Guaranty Financial Group is rumored to be the next casualty this weekend. The company's announcement came after the bank, at the behest of regulators, wrote down the values of investment assets by more than $1.4 billion. That move left the bank with negative capital.

The description of the bank is below as per GFG's website:

Guaranty Financial Group Inc. (NYSE: GFG) is the second largest publicly-traded financial services holding company headquartered in Texas and one of the 50 largest publicly-traded financial services companies based in the U.S. ranked by asset size, offering a range of financial services through its primary operating subsidiary, Guaranty Bank.

Guaranty Bank is a federally-chartered savings bank that began operations in 1988. With assets of approximately $16 billion and more than 150 banking centers in Texas and California, Guaranty Bank offers a full range of consumer and business deposit and loan products serving diverse geographic markets throughout the U.S., making it one of the largest financial institutions headquartered in Texas.

Through our full range of products, we are committed to growing sustainable client relationships and delivering our products with extraordinary service.

Quagmire Worsens for Guaranty

Guaranty Financial Group Inc.'s situation doesn't appear as though it's getting any better.

Late Monday the Austin-based parent company of Guaranty Bank filed a regulatory statement saying it won't be able to report its second quarter financials on time. The company also reiterated its position as "critically undercapitalized" and said again that it does not believe it "will be able to continue as a going concern." Guaranty and its parent company, Guaranty Financial Group, are technically based in Austin, while its executive team is located in Dallas.

A takeover of Guaranty (NYSE: GFG) by the FDIC now appears inevitable. Citing sources familiar with the situation, the news agency Reuters reports that a U.S. regulator has set Tuesday as the deadline for other banks to bid on Guaranty. If indeed Guaranty falls, it would be the second largest bank failure so far this year, following last week's federal takeover of Montgomery, Ala.-based Colonial BancGroup Inc., which is now part of BB&T.

Meanwhile, Guaranty shares continue to plummet. The stock fell another 17 percent on Tuesday to 33 cents a share. After falling to an all-time low of 12 cents in late July, shares rebounded a bit to close at 58 cents on Aug. 13. Shares have traded as high as $6.75 in the last year.

The Dallas Business Journal first reported in July that Guaranty Bank confirmed it was likely to fail.

The company's announcement came after the bank, at the behest of regulators, wrote down the values of investment assets by more than $1.4 billion. That move left the bank with negative capital.