Southwest Bank in Jennings, La. was closed Nov. 21 by Louisiana regulators, the first failure of a federally insured bank since August 1996.

The failure cost the Bank Insurance Fund approximately $3.5 million. Louisiana's Office of Financial Institutions blamed the bank's troubles on agricultural loans that went sour.

Under a deal approved by the Federal Deposit Insurance Corp., the bank's deposits will be assumed by a newly chartered institution, First Southwest Bank, which opened Monday.

First Southwest will assume about 2,000 deposit accounts totaling $26.8 million and assets of $20 million.

In a separate agreement, Gulf Coast Bank and Trust in New Orleans will purchase $2.3 million of the failed bank's assets from the FDIC. -Bill McConnell

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