July 23 - First Cherokee State Bank, Woodstock, Ga., has been closed by the Georgia Department of Banking and Finance, which appointed the FDIC as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Community & Southern Bank, Atlanta, to assume all of the deposits of First Cherokee State Bank.
As of March 31, 2012, First Cherokee State Bank had approximately $222.7 million in total assets and $193.3 million in total deposits. Community & Southern Bank will pay the FDIC a premium of 0.50 percent to assume all of the deposits of First Cherokee State Bank. In addition to assuming all of the deposits of the failed bank, Community & Southern Bank agreed to purchase essentially all of the failed bank's assets.
The FDIC and Community & Southern Bank entered into a loss-share transaction on $141.8 million of First Cherokee State Bank's assets. Community & Southern Bank will share in the losses on the asset pools covered under the loss-share agreement. The loss-share transaction is projected to maximize returns on the assets covered by keeping them in the private sector. The transaction also is expected to minimize disruptions for loan customers. For more information on loss share, please visit: www.fdic.gov/bank/individual/failed/lossshare/index.html.
Customers with questions about the transaction should call the FDIC toll-free at 800-640-2751. The phone number will be operational from 9:00 a.m. to 5:00 p.m., EDT. Interested parties also can visit the FDIC's website at www.fdic.gov/bank/individual/failed/cherokee.html.
The FDIC estimates that the cost to the Deposit Insurance Fund will be $36.9 million. Compared to other alternatives, Community & Southern Bank's acquisition was the least costly resolution for the FDIC's DIF. First Cherokee State Bank is the 36th FDIC-insured institution to fail in the nation this year, and the eighth in Georgia. The last FDIC-insured institution closed in the state was Georgia Trust Bank, Buford the same day.