On Friday, the Arizona Department of Financial Institutions closed First State Bank, headquartered in Flagstaff, Arizona, and the FDIC was named as receiver. The FDIC entered into a purchase and assumption agreement with Sunwest Bank, headquartered in Tustin, California, to assume the deposits of the failed bank.

As of July 29, 2009, First State Bank had total assets of $105 million and total deposits of approximately $95 million. Sunwest Bank also agreed to purchase essentially all of the assets of the failed bank.

The FDIC estimates that the cost to the Deposit Insurance Fund will be approximately $47 million. First State Bank is the 89th bank to fail in the nation this year and the 3rd in Arizona.