Federal regulators should have taken more aggressive steps to deal with Alpha Bank and Trust before it failed in October in one of the fastest bank failures in U.S. history, according to a watchdog.

The Federal Deposit Insurance Corp.'s inspector general said in a report issued Tuesday that regulators should have been more concerned the Alpharetta, Ga., bank was growing well beyond its original business plan.

At the time of its failure, Alpha Bank had roughly $334 million of assets and had been in business for only 29 months. Its failure marked the shortest amount of time between a bank receiving approval for federal deposit insurance and its takeover by regulators.

The report paints a picture of a bank that aggressively sought to claim its piece of the booming housing market but quickly collapsed under the weight of its own ambition.

Inadequate underwriting, few risk management controls, a reliance on high-cost funding and a concentration on high-risk residential development and construction loans caused Alpha Bank's downfall, the report said.

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