SAC CITY — The first Iowa bank failure in a dozen years took place in the county seat of Sac County in early November, but a succeeding bank took over the bank’s assets, and it has reopened.

The fact that the bank quickly changed hands and is open for business has made Sac City residents more at ease with what happened, Mayor Scott Bundt said Monday.

“It caught everybody off guard,” Bundt said.

A recent review of Citizens Bank in Sac City turned up loan losses that previous audits had not detected, the Iowa Division of Banking announced in a release. Therefore the state’s Superintendent of Banking declared it insolvent and closed Citizens Bank, and tendered the receivership to the Federal Deposit Insurance Corporation, the government entity that insures

qualified bank deposits up to $250,000.

Iowa Trust & Savings Bank, of Emmetsburg, purchased the bank, and on Nov. 6 re-opened the Sac City office as a branch office.

“It seemed to be seamless,” Bundt said, adding that it was only natural that some people had some unease about the change.

Citizens Bank was the first Iowa bank to be closed since 2011. The bank had a concentration of non-regional loans to one industry and experienced heavy losses on some of those loans.

Citizens Bank was established in 1929 and had a main office and drive-up facility.

As of its third quarter call report, Citizens Bank reported $65.6 million in total assets and $58.9 million in total deposits, according to the Banking Division.

There are three banks in Sac City, a town of 2,040 people.

Briana Snyder, a Sac City Main Street board member, said the Citizens Bank failure was surprising, but people are taking the news in stride because of the rapidly announced purchase by the Emmetsburg bank.

“We are relieved,” Snyder said.

For customers of the former Citizens Bank who have questions, the FDIC has established a toll free number at (866) 314-1744.