This is exactly the way it should be handled in the rare circumstances where a thread needs to be closed. But if public warnings and bans are handed out as needed you will almost never have to close a thread, because the offenders (having received their ban) will be unable to further post in the thread. But in no case, ever, should a thread be deleted. If you just absolutely feel in the most rare circumstance that a thread should be closed, it should still remain publicly view-able with the last post being a short but very direct and open explanation from the mod (to include member names or post numbers as needed) on why it was closed.
