Sep. 28--Like a lot of banks in Northeast Florida, CBC National Bank has been saddled with a large number of bad real estate loans. But the Fernandina Beach-based bank's problems became large enough that it has entered into an agreement with the U.S. Comptroller of the Currency to improve its operations.

Coastal Banking Co. Inc., the parent company of the bank, announced that the agreement outlines strategies for the bank to reduce credit risk and improve its asset quality and earnings.

Coastal Banking is headquartered in Beaufort, S.C., but CBC National Bank is its main subsidiary and is headquartered in Fernandina Beach. The bank operates there under the name First National Bank of Nassau County, and it also has banking offices in South Carolina and Georgia under other names.

The agreement states that "the Comptroller has found unsafe and unsound banking practices relating to the bank's increasing credit risk. Additional actions by the board and management are needed to restore the bank to a safe and sound condition."

Although the agreement with the Comptroller (the federal agency that regulates nationally chartered banks) was signed in August, Coastal Banking CEO Michael Sanchez said the bank identified its loan problems a year ago and began aggressively working to fix them. The bank formed a "special assets group" in late 2008 that has been working to resolve or restructure weak loans.

"We're very confident we'll pull out of it," he said.

Coastal Banking reported a net loss of $2.2 million, or 96 cents a share, in the first half of 2009. But the company said its bank remains well capitalized, with total risked-based capital equaling about 14 percent of its assets, higher than the 10 percent ratio required by federal regulators.

The bank reported that its total level of non-current loans -- loans that are at least 90 days overdue -- was 44 percent of its capital and reserves as of June 30.

New high for Web.com

Web.com Group Inc. jumped to a 52-week high last week after FBR Capital Markets analyst David Hilal raised his rating on the company from "market perform" to "outperform."

Hilal said in a research note that business trends are stabilizing for the Jacksonville-based company, which develops Web sites for small and medium-sized businesses.

"We believe that the pressure on the company's end markets is easing and that the third quarter should mark the inflection point of the company's business," he wrote. Hilal raised his price target on the stock from $7 to $9.

Web.com rose as much as $1.24 to $7.93 at midday Wednesday after the upgrade.