SYLACAUGA — Alabama Trust Bank was closed by the Office of Comptroller of the Currency on Friday.

The OCC, part of the United States Department of the Treasury, appointed the Federal Deposit Insurance Corporation as receiver.

According to a press release, the FDIC has entered into a purchase and assumption agreement with Southern States Bank out of Anniston to assume all of the bank’s deposits.

The bank will open during its normal business hours Saturday as a branch of Southern States Bank. All bank users will automatically become depositors of the new branch.

“Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship in order to retain their deposit insurance coverage up to applicable limits,” the FDIC said in the press release. “Customers of Alabama Trust Bank should continue to use their existing branch until they receive notice from Southern States Bank that it has completed systems changes to allow other Southern States Bank branches to process their accounts as well.”

The OCC states the federal takeover was necessary after the bank experienced a “dissipation of assets and earnings due to unsafe or unsound practices.” It also determined Alabama Trust Bank was likely to incur losses that would deplete its capital.

“The bank is critically undercapitalized, and there is no reasonable prospect that the bank will become adequately capitalized without federal assistance,” a press release stated.

Over the weekend, depositors of Alabama Trust Bank can access their money by writing checks or using ATM or debit cards. Checks drawn on the bank will continue to be processed. Loan customers should continue to make their payments as usual.

According to the FDIC, Alabama Trust Bank had approximately $51.6 million in total assets and $45.1 million in total deposits as of March 31. In addition to assuming all of the deposits of the failed bank, Southern States Bank agreed to purchase essentially all of the assets.

Customers with questions should call the FDIC toll free at 1-800-405-8124. The phone number will be operational Saturday from 9 a.m. to 6 p.m., Sunday from noon to 6 p.m., Monday from 8 a.m. to 8 p.m., and thereafter from 9 a.m. to 5 p.m.

The FDIC estimates that the cost to the Deposit Insurance Fund will be $8.9 million. Compared to other alternatives, Southern States Bank's acquisition was the least costly resolution for the FDIC's DIF.

Alabama Trust Bank is the 24th FDIC insured institution to fail in the nation this year, and the first in Alabama. The last FDIC insured institution closed in the state was Superior Bank in Birmingham in April 2011.

Contact Emily Adams at eadams@dailyhome.com.