July 16, 2010 – First National Bank of the South was closed by the Office of the Comptroller of the Currency, which appointed the FDIC as receiver. The FDIC entered into a purchase and assumption agreement with NAFH National Bank, Miami, Florida (a newly-chartered bank subsidiary of North American Financial Holdings, Inc., Charlotte, North Carolina) to take over failed First National Bank.
All thirteen branches of First National Bank will reopen as branches of NAFH and customers of First National will automatically become customers of NAFH and will continue to be insured by the FDIC.
NAFH National Bank agreed to assume all the deposits and essentially all of the assets of failed First National Bank. At March 31, 2010, First National had total assets of $682.0 million and total deposits of $610.1 million. NAFH did not pay a premium on the purchase of the failed bank’s deposits.
The FDIC and NAFH National Bank entered into a loss share transaction on $512.4 million of the assets of First National Bank. The loss-share agreement is expected to maximize returns on assets by keeping them in the private sector and minimize disruptions for loan customers. NAFH will share in the losses on the assets covered by the loss-share agreement.
First National became the third banking failure in South Carolina this year and the nation’s 92nd failure . The second banking failure of the year in South Carolina also occurred today with the failure of Woodlands Bank, Bluffton, SC. The estimated cost to the FDIC Deposit Insurance Fund for closing First National is $74.9 million.