Exhibit 99.1

                        Atlantic Coast Federal Announces
        Adoption of Plan to Conduct Second-Step Conversion and Offering


    WAYCROSS, Ga.--(BUSINESS WIRE)--May 7, 2007--Atlantic Coast
Federal Corporation (the "Company") (NASDAQ:ACFC), today announced
that the Board of Directors of its mutual holding company, Atlantic
Coast Federal, MHC (the "Mutual Holding Company"), has adopted a plan
to convert the Mutual Holding Company from the mutual to stock form of
organization. The Mutual Holding Company is a federally chartered
mutual holding company and currently owns approximately 64%, of the
outstanding shares of common stock of the Company, which owns 100% of
the issued and outstanding shares of the capital stock of Atlantic
Coast Bank (the "Bank").

    In connection with the conversion, shares of common stock of a new
successor holding company, representing the ownership interest of the
Mutual Holding Company, will be offered for sale to depositors of the
Bank. The following persons and employee benefit plan have
subscription rights to purchase shares of common stock of the new
holding company in the following order of priority: (1) depositors of
record as of March 31, 2006; (2) the Bank's employee stock ownership
plan; (3) depositors of record as of the end of the calendar quarter
preceding the commencement of the offering; and (4) depositors
entitled to vote on the conversion proposal. If necessary, shares will
be offered to the general public. In addition, upon completion of the
conversion of the Mutual Holding Company, shares of the Company's
common stock held by public stockholders will be exchanged for shares
of the new holding company, which will be the Bank's new parent
holding company. As a result of the conversion and offering, the
Mutual Holding Company and Company will cease to exist.

    The conversion is subject to approval of the Office of Thrift
Supervision as well as the approval of the Mutual Holding Company's
members (depositors of the Bank) and the Company's stockholders. Proxy
materials setting forth information relating to the conversion and
offering will be sent to the members of the Mutual Holding Company and
stockholders of the Company for their consideration. The offering will
be made only by means of a prospectus in accordance with federal law
and all applicable state securities laws; this press release shall not
constitute an offer to sell or the solicitation of an offer to buy any
securities. The conversion and offering are expected to be completed
early in the fourth quarter of 2007.

    The Bank's normal business operations will continue without
interruption during the conversion and offering process. The
transaction will not affect the existing terms and conditions of
deposit accounts and loans with the Bank. Deposit accounts will
continue to be insured by the Federal Deposit Insurance Corporation to
the fullest extent permitted by law.

    Atlantic Coast Federal Corporation is the holding company for
Atlantic Coast Bank, a federally chartered and insured stock savings
association that was organized in 1939 as a credit union to serve the
employees of the Atlantic Coast Line Railroad. In November 2000, the
credit union converted its charter from a federal credit union to a
federal mutual savings association and, in January 2003, Atlantic
Coast Federal Corporation was formed as the holding company. The
Company completed its initial public stock offering in October 2004.
Investors may obtain additional information about Atlantic Coast
Federal Corporation on the Internet at www.AtlanticCoastBank.net,
under the Investor Information section.

    Atlantic Coast Bank, with approximately $886 million in assets as
of March 31, 2007, is a community-oriented financial institution. It
serves southeastern Georgia and northeastern Florida through 14
offices, including a focus on the Jacksonville metropolitan area.

    This news release contains forward-looking statements within the
meaning of the federal securities laws. Statements in this release
that are not strictly historical are forward-looking and are based
upon current expectations that may differ materially from actual
results. These forward-looking statements, identified by words such as
"will," "expected," "believe," and "prospects," involve risks and
uncertainties that could cause actual results to differ materially
from those anticipated by the statements made herein. These risks and
uncertainties involve general economic trends and changes in interest
rates, increased competition, changes in consumer demand for financial
services, the possibility of unforeseen events affecting the industry
generally, the uncertainties associated with newly developed or
acquired operations, and market disruptions and other effects of
terrorist activities. The Company undertakes no obligation to release
revisions to these forward-looking statements publicly to reflect
events or circumstances after the date hereof or to reflect the
occurrence of unforeseen events, except as required to be reported
under the rules and regulations of the Securities and Exchange
Commission.

    This news release is not an offer to sell or the solicitation of
an offer to buy the common stock, which is made only pursuant to a
prospectus, nor shall there be any sale of common stock in any state
in which such offer, solicitation or sale would be unlawful before
registration or qualification under the securities laws of any such
state.



    CONTACT: Corporate Communications, Inc.
             Patrick J. Watson, 615-254-3376