UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of The

~~The~~ Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) ~~February~~May 17, 2012

AB&T Financial Corporation

(Exact name of registrant as specified in its charter)

North Carolina	000-53249	26-2588442
(State or other jurisdictionof incorporation)	(CommissionFile Number)	(IRS EmployerIdentification No.)
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)
292 West Main Avenue, Gastonia, North Carolina		28054
(Address of principal executive offices)		(Zip Code)


292 West Main Avenue, Gastonia, North Carolina				28054
(Address of principal executive offices)				(Zip Code)

Registrant’s telephone number, including area code (704) 867-5828

N/A

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 Entry into a Material Definitive Agreement.

~~Alliance~~Effective ~~Bank~~May &7, ~~Trust~~2012, ~~Company~~AB&T ~~(the~~Financial ~~“Bank”)~~Corporation, the ~~wholly~~bank ~~owned~~holding ~~subsidiary~~company offor ABAlliance Bank &T ~~Financial~~Trust ~~Corporation~~Company (the “~~Company~~Bank”), ~~has~~ entered into a ~~Stipulation~~written toagreement ~~the Issuance of a Consent Order (the “Stipulation”)~~ with the Federal ~~Deposit~~Reserve ~~Insurance~~Bank ~~Corporation (the “FDIC”) and the North Carolina Office~~ of ~~the~~Richmond ~~Commissioner of Banks~~ (the “~~Commissioner~~Reserve Bank”) ~~and~~ (the ~~FDIC~~final ~~and~~written ~~the~~agreement, ~~Commissioner~~as ~~have~~executed ~~issued~~by the ~~related~~parties, ~~Consent~~is ~~Order~~herein (called the “~~Order~~Written Agreement”)~~, effective February 1, 2012~~. The description of the ~~Stipulation~~Written ~~and~~Agreement ~~the Order~~ set forth below is qualified in its entirety by reference to the ~~Stipulation~~Written ~~and the Order~~Agreement, ~~copies~~a copy of which ~~are~~is filed herewith as ~~exhibits~~exhibit 10.1 and ~~10.2, respectively, and~~ incorporated herein by reference.

~~Management.~~Source ~~The~~of ~~Bank~~Strength. isUnder ~~required to assess management’s ability to (1) comply with~~ the ~~requirements~~terms of the ~~Order;~~Written ~~(2) operate~~Agreement, the ~~Bank~~Company inis arequired ~~safe~~to ~~and~~take ~~sound~~appropriate ~~manner; (3) comply~~steps ~~with~~to ~~all~~fully utilize ~~applicable~~its ~~laws~~financial and ~~regulations;~~managerial ~~and~~resources ~~(4) improve~~to ~~the~~serve ~~Bank’s~~as ~~asset~~a ~~quality,~~source ~~capital~~of ~~adequacy,~~strength ~~earnings, management effectiveness, risk management, liquidity, and sensitivity~~ to ~~market risk. To assist with this assessment,~~ the Bank, ~~must retain a consultant to develop a written analysis~~ and ~~assessment~~ensure ofthat the Bank’s ~~management~~complies ~~needs~~with ~~within 30 days of~~ the ~~effective~~requirements ~~date~~ of the ~~Order.~~consent ~~The~~order ~~consultant’s~~issued ~~management~~by ~~report must be developed within 60 days from~~ the ~~effective~~Federal ~~date~~Deposit ofInsurance ~~the~~Corporation ~~Order.~~and ~~Within 30 days from receipt of~~ the ~~management~~North ~~report,~~Carolina Office ~~the Bank must formulate a written management plan that incorporates the findings~~ of the ~~management~~Commissioner ~~report, a plan~~ of ~~action in response to each recommendation contained in the management report, and a time frame for completing each action~~Banks.

~~Capital Requirements~~Dividends. ~~While~~ ~~the~~The ~~Order~~Written isAgreement inprohibits ~~effect,~~ the ~~Bank~~Company’s ~~must~~payment ~~maintain~~of any adividends ~~leverage~~without ~~ratio (~~the ~~ratio~~prior ofapproval ~~Tier 1 capital to total assets)~~ of atthe ~~least~~Reserve 8%Bank and athe ~~total~~Director ~~risk-based~~of ~~capital ratio (~~the ~~ratio~~Division of ~~qualifying~~Banking ~~total~~Supervision ~~capital~~and toRegulation ~~risk-weighted assets)~~ of ~~at least~~the ~~11%.~~Federal IfReserve ~~either~~Board of ~~these~~Governors. ~~capital~~It ~~ratios~~also ~~are~~prohibits ~~below~~ the ~~required~~Company ~~levels~~from asdirectly ofor ~~the~~indirectly ~~date~~taking of any dividends ~~call report~~ or ~~regulatory~~any ~~examination,~~other ~~the~~form ~~Bank~~of ~~must,~~payment ~~within~~representing ~~30 days from receipt of~~ a ~~written~~reduction ~~notice~~in of capital ~~deficiency~~ from ~~its~~the ~~regulators,~~Bank ~~present a~~without ~~plan~~the toprior ~~increase~~written ~~capital~~approval ~~to meet the requirements~~ of the ~~Order~~Reserve Bank.

~~Charge-Offs,~~Debt ~~Credits~~and Stock Redemption. The ~~Order~~Written Agreement requires that the ~~Bank~~Company ~~eliminate from its books~~not, bydirectly ~~charge-off~~ or ~~collection~~indirectly, ~~all~~incur, ~~assets~~increase, or ~~portions~~guarantee ofany ~~assets~~debt ~~classified~~without ~~“loss”~~the ~~and~~prior ~~50%~~written approval of ~~those assets classified “doubtful.” If an asset is classified “doubtful,”~~ the Reserve Bank. ~~may alternatively~~The ~~charge~~Reserve ~~off the amount that is considered uncollectible in accordance with the~~ Bank’s prior written ~~analysis~~approval ofis ~~loan or lease impairment. The Order~~ also ~~prevents~~required ~~the Bank from extending, directly or indirectly, any additional credit to, or~~ for the ~~benefit~~Company ~~of,~~to ~~any~~purchase ~~borrower who has a loan~~ or ~~other extension of credit from the Bank that has been charged off or classified~~redeem, ~~in whole or in part, “loss” or “doubtful” and is uncollected. The Bank may not extend,~~ directly or indirectly, any ~~additional~~shares ~~credit to any borrower who has a loan or other extension~~ of ~~credit~~its ~~from~~capital ~~the Bank that has been classified “substandard~~stock.” ~~These limitations do not apply if the Bank’s failure to extend further credit to a particular borrower would be detrimental to the best interests of the Bank.~~

~~Allowance~~Affiliate ~~for~~Transactions. ~~Loan~~The Written Agreement requires that the Company ensure the Bank’s compliance with sections 23A and ~~Lease~~23B of the Federal Reserve Act as well as Regulation W (12 ~~Losses~~C.F.R. ~~Within~~Part 60223) ~~days~~in ofall transactions between the ~~effective~~Bank ~~date~~and ofits affiliates, including the ~~Order~~Company. Such transactions include the transfer, sale, or purchase of a Bank asset; the ~~board~~direct or indirect payment of ~~directors~~an ~~must~~obligation ~~review~~of the ~~adequacy~~Company; the payment by the Bank of management or service fees to the ~~allowance~~Company; ~~for~~or ~~loan~~any ~~and~~extension ~~lease~~of ~~losses~~credit (by the ~~“ALLL”)~~Bank ~~and~~to ~~establish~~the Company. The Company is also required to submit to the Reserve Bank a ~~policy~~written plan to reimburse the Bank for ~~determining~~a loan the ~~adequacy~~Bank ofmade to the ~~ALLL~~Company.

~~Concentrations of Credit~~Compliance. ~~Within~~The 90Written ~~days~~Agreement ~~from~~requires that the ~~effective~~Company ~~date~~comply ofwith ~~the~~applicable ~~Order,~~notice ~~the~~provisions ~~Bank~~when ~~must~~it appoints ~~perform~~ a ~~risk segmentation~~new ~~analysis~~director ~~with~~or ~~respect~~senior toexecutive ~~its~~officer ~~concentrations~~or ofwhen ~~credit~~it ~~and~~changes ~~must develop~~ a ~~written~~senior ~~plan~~executive ~~for systematically reducing and monitoring the Bank~~officer’s ~~concentration~~responsibilities; ofthe ~~credit~~Company inmust ~~revolving~~also ~~1–4~~comply ~~family residential property loans to an amount commensurate~~ with ~~the~~certain ~~Bank’s~~regulatory ~~business~~restrictions ~~strategy,~~on ~~management,~~indemnification ~~expertise, size,~~ and ~~location~~severance payments.

~~Asset~~Progress ~~Growth~~Reports. ~~While~~ ~~the~~The ~~Order~~Written isAgreement inrequires ~~effect,~~that the ~~Bank~~Company ~~must~~file ~~notify~~a ~~its~~written ~~regulators~~progress atreport ~~least~~within 6030 days ~~prior~~after ~~to undertaking asset growth that exceeds 10% or more per year or initiating material changes in asset or liability composition. The Bank’s asset~~the ~~growth~~end ~~cannot~~of ~~result~~each incalendar ~~noncompliance~~quarter ~~with~~while the ~~capital~~Written ~~maintenance~~Agreement ~~provisions~~remains ofin ~~the Order unless the Bank receives prior written approval from its regulators~~effect.

~~Restriction~~The onWritten ~~Dividends~~Agreement ~~and~~will ~~Other~~remain ~~Payments.~~effective ~~While~~and enforceable ~~the~~until ~~Order is in effect~~stayed, ~~the Bank cannot declare or pay dividends~~modified, ~~pay bonuses~~terminated, or ~~pay~~suspended ~~any form of payment outside the ordinary course of business resulting~~ in awriting ~~reduction~~by ~~of capital without~~ the ~~prior~~Reserve ~~written approval of its regulators. In addition, the~~ Bank ~~cannot make any distributions of interest, principal, or other sums on subordinated debentures without prior regulatory approval~~.

~~Brokered Deposits.~~ The ~~Order~~foregoing ~~provides~~description ~~that~~of the Written ~~Bank~~Agreement ~~may~~is ~~not~~a ~~accept,~~summary ~~renew,~~and ordoes ~~roll~~not ~~over~~purport ~~any~~to ~~brokered deposits~~be ~~unless~~a itcomplete isdescription inof ~~compliance~~all ~~with~~of the ~~requirements~~terms of the ~~FDIC~~Written ~~regulations governing brokered deposits~~Agreement.

Loan Review. Within 60 days from the effective date of the Order, the Bank must review and revise its internal loan review and grading system to provide for the effective periodic review of the Bank’s loan portfolio in order to identify and categorize the Bank’s loans and other extensions of credit on the basis of credit quality. Within 90 days from the effective date of the Order, the Bank must contract for an external loan review to assess the accuracy of the Bank’s loan grading system and the quality of credit underwriting and administrative practices.

HELOC Portfolio. Within 60 days from the effective date of the Order, the Bank must perform a comprehensive assessment of the risk posed by its home equity line of credit (“HELOC”) portfolio. The Bank must also develop and implement a plan to reduce the risk in the HELOC portfolio.

Call Reports. As required by the Order, the Bank has filed amended call reports regarding the financial condition of the Bank as of March 31, 2011.

Written Plans and Other Material Terms. Under the terms of the Order, the Bank is required to prepare and submit the following written plans or reports to the FDIC and the Commissioner:

• Plan to reduce assets of $250,000 or greater classified as “doubtful” or “substandard”

• Plan and comprehensive budget for all categories of income and expense for the year 2012

• Business/strategic plan covering the overall operation of the Bank

• Plan to improve liquidity, contingency funding, interest rate risk, and asset liability management

• Assessment of the Bank’s information technology function

• Enterprise-wide disaster recovery/business continuity plan

• Policy to provide adequate internal routines and controls within the Bank consistent with safe and sound banking practices

• Independent testing of the Bank’s compliance with the Bank Secrecy Act and associated regulations

Under the Order, the Bank’s board of directors has agreed to increase its participation in the affairs of the Bank, including assuming full responsibility for the approval of policies and objectives for the supervision of all of the Bank’s activities. The Bank must also establish a board committee to monitor and coordinate compliance with the Order.

The Order will remain in effect until modified or terminated by the FDIC and the Commissioner.

Item 9.01. Financial Statements and Exhibits

(d)

Exhibits

ExhibitNo		Description of Exhibit
ExhibitNo.		Description of Exhibit
10.1		~~Stipulation~~Written toAgreement by and between AB&T Financial Corporation and the ~~Issuance~~Federal ofReserve aBank ~~Consent~~of ~~Order~~Richmond
10.2		Consent Order issued by the Federal Deposit Insurance Corporation and the North Carolina Office of the Commissioner of Banks

Caution About Forward-Looking Statements

This Current Report on Form 8-K (including information included or incorporated by reference herein) may contain, among other things, certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, without limitation, (i) statements regarding certain of Registrant’s goals and expectations with respect to earnings, income per share, revenue, expenses and the growth rate in such items, as well as other measures of economic performance, including statements relating to estimates of credit quality trends, and (ii) statements preceded by, followed by or that include the words “may,” “could,” “should,” “would,” “believe,” “anticipate,” “estimate,” “expect,” “intend,” “plan,” “projects,” “outlook” or similar expressions. These statements are based upon the current belief and expectations of Registrant’s management and are subject to significant risks and uncertainties that are subject to change based on various factors (many of which are beyond Registrant’s control).

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

		AB&T Financial Corporation
		(Registrant)
Date February 7, 2012
Date	May 11, 2012
		/s/ Daniel C. Ayscue
		Daniel C. Ayscue
		President and Chief Executive Officer

EXHIBIT INDEX

ExhibitNo		Description of Exhibit
ExhibitNo.		Description of Exhibit
10.1		~~Stipulation~~Written toAgreement by and between AB&T Financial Corporation and the ~~Issuance~~Federal ofReserve aBank ~~Consent~~of ~~Order~~Richmond
10.2		Consent Order issued by the Federal Deposit Insurance Corporation and the North Carolina Office of the Commissioner of Banks

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