The workers are busy at the American Security Bank branch on Wisconsin Avenue and Harrison Street NW, repaving the parking lot, remodeling the interior, fixing the roof. But instead of pleasing bank customers, the improvements have made at least one, Louis Hyatt, very angry.

"For a bank that's in so much financial trouble to be spending more than $100,000 to upgrade a building when the other was perfectly adequate -- it just doesn't make sense to me," Hyatt said.

American Security, suffering massive losses on its real estate loans, is short of capital, the cash and assets that banks must have on hand to protect the federal deposit insurance fund from losses. The bank is under a special order by the Office of the Comptroller of the Currency, which oversees national banks, to raise its capital levels by March 1991.

"When I'm short of money, the first thing I do is cut out the luxuries. I thought everybody knew that," Hyatt said.

He was so angered by the remodeling that he called the comptroller's office to complain, but an official there said it was an issue for the bank's shareholders and there was nothing the agency could do.

Daniel Finney, spokesman for American Security's parent company, MNC Financial Inc., declined to comment on the expenditure.