Updated: 10/04/2025 20:43:46
SunFirst Bank
SunFirst Bank of Saint George, Utah was closed by state regulators on November 4, 2011 and the FDIC was appointed receiver. Cache Valley Bank (Logan, UT) assumed most deposit accounts and acquired a large portion of assets under a purchase-and-assumption and loss-share arrangement. The failure stemmed primarily from concentrated land-development and real-estate lending that produced heavy loan losses and severe capital erosion; the bank’s involvement in large-scale payment processing for online poker operations and related legal issues was a complicating factor. The FDIC wound down the receivership, completed dividend distributions, published required notices, and terminated the receivership effective August 1, 2017.
Consumer Guidance and Fraud Warnings
The FDIC advised customers about legitimate communications, cautioned against phishing and scams following the failure, and provided cybersecurity guidance and consumer resources to verify account status and access information. [1]
Deposit Transfer Terms and Customer Access
Most depositor accounts were transferred to Cache Valley Bank (excluding certain brokered deposits such as Cede & Co.); customers had immediate access to insured funds and transferred deposits were separately insured for at least six months while customers could withdraw without early-withdrawal penalties until accepting new deposit agreements. [2]
Documentation, Bids and FDIC Materials
Key transaction documents available include the Purchase & Assumption agreement, FDIC bid-summary for the acquisition, dividend records on the FDIC closed-banks site, and archived FDIC press materials and consumer guidance issued at the time of failure. [3]
Failure and Receivership (Nov 4, 2011)
State regulators closed SunFirst Bank on November 4, 2011 and appointed the FDIC as receiver after the bank became critically undercapitalized and unable to continue safe operations. [4]
Financial Details, Assets, Deposits, and Loss-Share
As of September 30, 2011 SunFirst reported roughly $198.1 million in assets and about $169.1 million in deposits; Cache Valley agreed to purchase approximately $177.3 million of assets and assumed about $128.9 million of those under a loss-share arrangement, with roughly $15 million of deposits not assumed. [5]
Online Poker Payment Processing and Legal Complications
SunFirst’s payment-processing relationship with online poker operators (reportedly processing over $200 million) and connections to individuals later facing federal indictment (including a vice chairman) complicated the bank’s operations and were cited as a contributing factor, though regulators identified asset quality and capital shortfalls as primary causes. [6]
Operational and Community Impact: Branches, Employees, and Market Entry
Cache Valley planned to reopen SunFirst’s three branches (two in St. George, one in Hurricane), retain many employees, and expand into the market; the FDIC immediately removed senior management upon receivership. [7]
Primary Causes of Failure: Real-Estate Concentration and Capital Erosion
The bank’s concentrated lending to Washington County land developers and speculators during the regional real-estate boom left it exposed when the housing market collapsed, producing rising defaults, severe asset-quality deterioration and regulatory orders to raise capital that were not met. [8]
Purchase & Assumption by Cache Valley Bank
Cache Valley Bank agreed to assume most deposit accounts and purchased the bulk of SunFirst’s assets under a purchase-and-assumption agreement with loss-share protections from the FDIC; three branches were to be reopened under the acquirer. [9]
Receivership Wind-Down, Dividends, and Legal Notices
The FDIC published a Notice of Intent to Terminate the receivership (March 29, 2017), completed required dividend distributions (see FDIC dividend index), and issued a Notice of Termination effective August 1, 2017, formally closing the receivership and discharging the receiver. [10]
Regulatory Timeline and Enforcement Actions
Regulators had ordered SunFirst to raise capital as early as October 2009; by mid-2011 the FDIC had declared the bank significantly undercapitalized and required recapitalization or a sale, culminating in the November 2011 closure when those measures were unsuccessful. [11]
References:
Additional Sources:
12. FDIC Archive Press Materials and Consumer Guidance [https://archive.fdic.gov/view/fdic/4239]
13. FDIC Bid Summary — SunFirst Bank [https://www.fdic.gov/bank-failures/bid-summary-sunfirst-bank-st-george-ut]
14. FDIC Dividend Index — SunFirst Bank (FIN 10411) [https://closedbanks.fdic.gov/dividends/bankfind/Dividendindex?fin=10411]
15. FDIC Failed Bank Information — SunFirst Bank (Saint George, UT) [https://www.fdic.gov/resources/resolutions/bank-failures/failed-bank-list/sunfirst.html]
16. Federal Register — Notice of Termination (Aug 8, 2017) [https://www.federalregister.gov/documents/2017/08/08/2017-16618/notice-of-termination-10411-sunfirst-bank-st-george-utah]
17. Federal Register — Notice to Interested Parties of Intent to Terminate Receivership (Mar 29, 2017) [https://www.federalregister.gov/documents/2017/03/29/2017-06166/notice-to-all-interested-parties-of-intent-to-terminate-the-receivership-of-10411-sunfirst-bank-st]
18. Purchase & Assumption Agreement — SunFirst Bank [https://www.fdic.gov/bank-failures/purchase-assumption-agreement-sunfirst-bank-saint-george-ut]
19. Salt Lake Tribune — Coverage of SunFirst Seizure and Resolution (2011) [https://archive.sltrib.com/article.php?id=52850409&itype=CMSID]