The Alabama State Banking Department closed CapitalSouth Bank, headquartered in Birmingham, Alabama, and the FDIC was named as receiver. As receiver, the FDIC entered into a purchase and assumption agreement with IBERIABANK, headquartered in Lafayette, Louisiana, to assume all the deposits of CapitalSouth Bank, except brokered deposits.

As of June 30, 2009, CapitalSouth Bank had total assets of $617 million and total deposits of approximately $546 million. IBERIABANK also agreed to purchase $589 million of the failed bank’s assets, with the FDIC retaining the remaining assets for later disposition. The FDIC and IBERIABANK entered into a loss-share transaction on approximately $499 million of CapitalSouth Bank’s assets. IBERIABANK did not assume Sthe $3.6 million in brokered deposits. The FDIC will pay the brokers directly for their funds.

The FDIC estimates that the cost to the Deposit Insurance Fund will be $151 million. CapitalSouth Bank is the 80th bank to fail in the nation this year and the 2nd in Alabama.