A Charleston-based bank with a Myrtle Beach branch was seized by government regulators at the close of business Friday, crushed by heavy chronic losses and dwindling reserves.

Financially ailing Atlantic Bank & Trust was shut down by the U.S. Office of Thrift Supervision, with the Federal Deposit Insurance Corp. acting as the receiver.

Deposits are safe, officials said.

Customers will continue to have access to their money this weekend, and no disruptions in service are anticipated.

The three-office bank will be reopened Monday by Columbia-based First Citizens Bank and Trust Co., which is taking over most of the failed lender's assets and accounts under a deal with the FDIC. Atlantic Bank & Trust had an office in Myrtle Beach at 7500 N. Kings Highway.

"We are encouraging former Atlantic Bank & Trust customers to continue banking as they normally do," said First Citizen spokeswoman Angela English.

The failure is expected to cost the FDIC's insurance fund about $36.4 million. Shareholders of the privately held bank's holding company will be wiped out.

The Charleston region saw its last major bank failures in the summer of 1992, when Cooper River Federal Savings & Loan and Citadel Federal Savings Bank collapsed.

Speculation has swirled for months about whether Atlantic Bank would survive the fallout of the prolonged real estate downturn that began to take hold about five years ago.

The lender had been reeling from three back-to-back years of losses and was "critically undercapitalized," federal regulators said in a statement Friday. Its 2011 first-quarter deficit totaled $4.4 million. The FDIC said Friday that Atlantic Bank was added to its "Problem Institution List" in February.

The lender began operating under a "cease-and-desist" supervisory order with the Office of Thrift Supervision in January after an examination last summer found "unsafe and unsound" practices.

Specifically, the OTS said the subsidiary of Atlantic Banc Holdings Inc. had inadequate levels of capital, earnings and contingency funds. It also said the bank was carrying an excessive amount of delinquent or bad loans on its books, most of them stemming from soured real estate deals.

At that time, Neal Arnold, who was president and chief executive officer until Friday, said the parent company and its board of directors entered into the agreement "to improve the safety and security of the bank's operations and capital activities."

"Since January 2010, management was aware of the issues raised by its primary regulator and had already taken steps to correct those issues," Arnold said in statement dated Jan. 31.

"This document is essentially a template for the operation of a safe and sound financial services company. In fact, many of our previously implemented strategic changes and plans of action mirror the requirements of the cease and desist order."

Under the order, the bank had until Feb. 28 to submit a plan specifying how it would raise more capital, with a backup strategy including a possible sale or merger.

Atlantic Bank had 68 employees in offices in downtown Charleston, Myrtle Beach and Savannah. It had assets of $208 million and retail deposits of $191 million.