UNITED\ue000 STATES
SECURITIES\ue000 AND\ue000 EXCHANGE\ue000 COMMISSION
Washington,\ue000 D.C.\ue000 20549

the\ue000 following\ue000 provisions:
\ue000 Written\ue000 communications\ue000 pursuant\ue000 to\ue000 Rule\ue000 425\ue000 under\ue000 the\ue000 Securities\ue000 Act\ue000 (17\ue000 CFR\ue000 230.425)
\ue000 Soliciting\ue000 material\ue000 pursuant\ue000 to\ue000 Rule\ue000 14a-12\ue000 under\ue000 the\ue000 Exchange\ue000 Act\ue000 (17\ue000 CFR\ue000 240.14a-12)
\ue000 Pre-commencement\ue000 communications\ue000 pursuant\ue000 to\ue000 Rule\ue000 14d-2(b)\ue000 under\ue000 the\ue000 Exchange\ue000 Act\ue000 (17\ue000 CFR\ue000 240.14d-2(b))
\ue000 Pre-commencement\ue000 communications\ue000 pursuant\ue000 to\ue000 Rule\ue000 13e-4(c)\ue000 under\ue000 the\ue000 Exchange\ue000 Act\ue000 (17\ue000 CFR\ue000 240.13e-4(c))

The\ue000 information\ue000 in\ue000 this\ue000 Form\ue000 8-K\ue000 and\ue000 the\ue000 attached\ue000 Exhibit\ue000 shall\ue000 not\ue000 be\ue000 deemed\ue000 filed\ue000 for\ue000 purposes\ue000 of\ue000 Section\ue000 18\ue000 of\ue000 the\ue000 Securities\ue000 Exchange Act\ue000 of\ue000 1934\ue000 or\ue000 otherwise\ue000 subject\ue000 to\ue000 the\ue000 liabilities\ue000 of\ue000 that\ue000 section,\ue000 nor\ue000 shall\ue000 it\ue000 be\ue000 deemed\ue000 incorporated\ue000 by\ue000 reference\ue000 in\ue000 any\ue000 filing\ue000 under\ue000 the Securities\ue000 Act\ue000 of\ue000 1933,\ue000 except\ue000 as\ue000 shall\ue000 be\ue000 expressly\ue000 set\ue000 forth\ue000 by\ue000 specific\ue000 reference\ue000 in\ue000 such\ue000 filing.

Atlantic\ue000 Coast\ue000 Bank,\ue000 today\ue000 reported\ue000 a\ue000 net\ue000 loss\ue000 of\ue000 $3,250,000\ue000 or\ue000 $0.25\ue000 per\ue000 basic\ue000 and\ue000 diluted\ue000 share\ue000 for\ue000 the\ue000 fourth\ue000 quarter\ue000 of\ue000 2008\ue000 versus\ue000 a\ue000 net\ue000 loss
of\ue000 $1,094,000\ue000 or\ue000 $0.09\ue000 per\ue000 basic\ue000 and\ue000 diluted\ue000 share\ue000 in\ue000 the\ue000 year-earlier\ue000 quarter.\ue000 For\ue000 2008,\ue000 the\ue000 net\ue000 loss\ue000 totaled\ue000 $2,845,000\ue000 or\ue000 $0.22\ue000 per\ue000 basic\ue000 and
diluted\ue000 share\ue000 compared\ue000 with\ue000 net\ue000 income\ue000 of\ue000 $1,115,000\ue000 or\ue000 $0.08\ue000 per\ue000 basic\ue000 and\ue000 diluted\ue000 share\ue000 in\ue000 2007.

The\ue000 net\ue000 loss\ue000 for\ue000 the\ue000 quarter\ue000 reflected\ue000 higher\ue000 provision\ue000 for\ue000 loan\ue000 losses\ue000 versus\ue000 the\ue000 third\ue000 quarter\ue000 of\ue000 2008\ue000 and\ue000 the\ue000 year-earlier\ue000 fourth\ue000 quarter.\ue000 The increase\ue000 was\ue000 due\ue000 primarily\ue000 to\ue000 ongoing\ue000 deterioration\ue000 of\ue000 certain\ue000 commercial\ue000 loan\ue000 participations\ue000 in\ue000 the\ue000 Company's\ue000 general\ue000 market\ue000 area\ue000 as\ue000 well\ue000 as continued\ue000 weakness\ue000 in\ue000 the\ue000 residential\ue000 real\ue000 estate\ue000 segment\ue000 of\ue000 the\ue000 Company's\ue000 loan\ue000 portfolio.

Non-performing\ue000 loans\ue000 were\ue000 $25,535,000\ue000 or\ue000 3.43%\ue000 of\ue000 total\ue000 loans\ue000 at\ue000 December\ue000 31,\ue000 2008,\ue000 up\ue000 from\ue000 $22,349,000\ue000 or\ue000 2.99%\ue000 of\ue000 total\ue000 loans\ue000 at\ue000 September 30,\ue000 2008,\ue000 and\ue000 $7,839,000\ue000 or\ue000 1.11%\ue000 of\ue000 total\ue000 loans\ue000 at\ue000 December\ue000 31,\ue000 2007.\ue000 A\ue000 total\ue000 of\ue000 $2,714,000\ue000 in\ue000 non-performing\ue000 loans\ue000 was\ue000 charged\ue000 off\ue000 during\ue000 the fourth\ue000 quarter\ue000 and\ue000 $1,492,000\ue000 was\ue000 transferred\ue000 to\ue000 Other\ue000 Real\ue000 Estate\ue000 Owned\ue000 (OREO).

Commenting\ue000 on\ue000 the\ue000 Company's\ue000 financial\ue000 results,\ue000 Robert\ue000 J.\ue000 Larison,\ue000 Jr.,\ue000 President\ue000 and\ue000 Chief\ue000 Executive\ue000 Officer,\ue000 said,\ue000 "As\ue000 we\ue000 continue\ue000 to\ue000 confront
a\ue000 broad\ue000 downturn\ue000 in\ue000 real\ue000 estate\ue000 values\ue000 and\ue000 recessionary\ue000 economic\ue000 conditions,\ue000 our\ue000 focus\ue000 has\ue000 remained\ue000 firmly\ue000 on\ue000 capital\ue000 preservation,\ue000 liquidity
and\ue000 credit\ue000 quality.\ue000 We\ue000 have\ue000 taken\ue000 several\ue000 necessary\ue000 and\ue000 important\ue000 steps\ue000 to\ue000 strengthen\ue000 the\ue000 Company\ue000 in\ue000 each\ue000 area.\ue000 Our\ue000 capital\ue000 position
remained\ue000 strong\ue000 at\ue000 December\ue000 31,\ue000 2008,\ue000 as\ue000 indicated\ue000 by\ue000 a\ue000 stockholders'\ue000 equity\ue000 to\ue000 total\ue000 assets\ue000 ratio\ue000 of\ue000 8.43%\ue000 and\ue000 tangible\ue000 stockholders'\ue000 equity\ue000 to
total\ue000 assets\ue000 of\ue000 8.13%.\ue000 Additionally,\ue000 our\ue000 liquidity\ue000 levels\ue000 were\ue000 at\ue000 or\ue000 above\ue000 both\ue000 regulatory\ue000 and\ue000 internal\ue000 policy\ue000 guidelines,\ue000 and\ue000 growth\ue000 in\ue000 our\ue000 core
deposit\ue000 base\ue000 during\ue000 2008\ue000 further\ue000 strengthened\ue000 our\ue000 liquidity.

"We\ue000 also\ue000 have\ue000 continued\ue000 to\ue000 evaluate\ue000 our\ue000 cost\ue000 structure\ue000 in\ue000 light\ue000 of\ue000 current\ue000 economic\ue000 and\ue000 industry\ue000 challenges,\ue000 as\ue000 well\ue000 as\ue000 those\ue000 we\ue000 expect\ue000 to
face\ue000 in\ue000 2009,"\ue000 Larison\ue000 continued.\ue000 "Earlier\ue000 in\ue000 the\ue000 year,\ue000 we\ue000 sold\ue000 an\ue000 underperforming\ue000 branch\ue000 and\ue000 implemented\ue000 other\ue000 cost-cutting\ue000 measures.\ue000 More
recently,\ue000 we\ue000 have\ue000 taken\ue000 further\ue000 steps\ue000 to\ue000 reduce\ue000 non-interest\ue000 expense\ue000 by\ue000 approximately\ue000 $1,000,000\ue000 in\ue000 2009.\ue000 These\ue000 latest\ue000 steps\ue000 include\ue000 a\ue000 freeze
on\ue000 all\ue000 employee\ue000 salaries\ue000 for\ue000 2009,\ue000 adjustments\ue000 to\ue000 employee\ue000 benefit\ue000 plans,\ue000 a\ue000 4.5%\ue000 reduction\ue000 in\ue000 sales\ue000 and\ue000 back-office\ue000 support\ue000 staff,\ue000 and\ue000 reduced
spending\ue000 in\ue000 non-essential\ue000 advertising,\ue000 marketing\ue000 and\ue000 facility\ue000 costs.\ue000 Together,\ue000 these\ue000 cost-cutting\ue000 initiatives\ue000 support\ue000 our\ue000 objectives\ue000 of
preserving\ue000 capital\ue000 and\ue000 increasing\ue000 efficiency,\ue000 while\ue000 reducing\ue000 annualized\ue000 non-interest\ue000 expense\ue000 by\ue000 an\ue000 expected\ue000 $2,100,000\ue000 when\ue000 these\ue000 cuts\ue000 are
fully\ue000 implemented.