MNC Financial Inc., the region's biggest banking company, has had an increase in "fraud-related" losses in the credit card subsidiary that it put up for sale, the Dow Jones News Service reported.

MNC said in a filing with the Securities and Exchange Commission that nonperforming loans for MBNA America Corp., its credit card subsidiary, jumped to $21.3 million in the first nine months of this year from $8.6 million last year. A company spokesman declined comment on the increase, which was described in the filing as a rise in "fraud-related outstandings."

MNC, parent of American Security Bank and Maryland National Bank, said in the same SEC filing that if it is unable to find a single buyer for its credit card operation, it may raise cash by selling stock in the subsidiary to the public. MNC must find a way to raise cash due to mammoth losses on commercial real estate loans and upcoming payments due on its outstanding debt.

Analysts had estimated at one time that MNC would raise substantially in excess of $1 billion from the sale of its credit card subsidiary, which serves a relatively upscale group of consumers. But the sale of the subsidiary to a single buyer has been complicated by the economy's downturn, financial problems faced by potential buyers and a market crowded by credit card operations up for sale. The rise in fraud-related losses also would appear to make it more difficult to sell the credit card business.

If MNC is unable to raise cash, either by selling MBNA or offering stock in the operation, it could be forced to default on outstanding debt and might be unable to raise enough capital to meet federal banking requirements. Capital is the money banks are required to have in reserve to provide a cushion against losses and to help prevent a failure that would require intervention by the federal agency that insures bank deposits.