SharePoint V2: ERROR: CREATE DATABASE permission denied in database 'master'. (Error code: 262).

Description:

From SharePoint Central Administration, attempting to create a new configuration database results in an error: "Error CREATE DATABASE permission denied in database 'master'. (Error code: 262)."




Solution:

* Start > Programs > Administrative Tools > IIS Manager > SharePoint Central Administration Web Site Properties > Home Directory Tab: Note the Application Pool Name (e.g. StsAdminAppPool).

* Start > Programs > Administrative Tools > IIS Manager > StsAdminAppPool Properties > Identity Tab: Set the user name and password to be the same as the database service account.

* Start > Run > IISRESET