Regulators closed the failed American Marine Bank, which had four branches on the North Olympic Peninsula, on Friday and are reopening each of its 11 branches under the ownership of Tacoma-based Columbia State Bank.
Each branch will reopen on its next normal business day, said an Federal Deposit Insurance Corp. statement released Friday.
The FDIC said deposits are safe and still insured by the federal agency. Accounts can still be accessed, checks will still be processed and loan customers can continue to make their payments as they had until the branches reopen, said the prepared statement.
Bainbridge Island-based American Marine Bank — with branches in Port Angeles, Sequim, Port Townsend and Port Ludlow — is the second bank with locations on the Peninsula to fail within the last year.
The other, Westsound Bank, was acquired by Kitsap Bank in May.
Two other Washington-based banks also failed this month: Horizon Bank of Bellingham and Evergreen Bank of Seattle.
American Marine Bank blamed defaults in real estate and commercial loans for its failure.
The Kitsap Sun reported in December that the bank’s “core” capital had dropped from $34 million to $13 million from October 2008 to October 2009.
“Consistent with many banks in the Northwest, AMB has been impacted by the severe downturn in the economy and the housing markets resulting in defaults in real estate and commercial loans,” said Judy Thorpe, bank senior vice president, in an e-mail to the Peninsula Daily News on Wednesday.
Thorpe wrote that the bank hired an investment firm in August to seek new investors. She said that came to no avail, adding:
“While there have been several inquires, the work has not resulted in capital acquisition, and because of the more favorable terms offered through an FDIC-assisted purchase, the bank is now working with the FDIC. The bank anticipates an assisted transaction to occur, but does not know when or with whom.”
The bank had been working with regulators last year to try to salvage the company.
It signed an agreement with the FDIC and state Department of Financial Institutions last November that required the bank to have an adequate reserve for loan losses and ensure that its board of directors is more involved in the management of the company, the Kitsap Sun reported. As part of the agreement, the bank also replaced its chief financial officer.
The FDIC said the bank had about $373.2 million in assets and $308.5 million in deposits as of Friday.
As part of the purchase agreement signed Friday, Columbia State Bank will pay the federal agency a 1-percent premium to acquire the deposits.
The FDIC estimates that the closure will cost its Deposit Insurance Fund $58.9 million.
The agency insures deposits up to $250,000 per bank customer.
The Department of Fianancial Institutions was the agency that officially closed the bank. It appointed the FDIC to handle the rest of the transaction.
The bank employed 135 people at its 11 branches in Clallam, Jefferson, Kitsap and Mason counties, and downtown Seattle. It was founded in 1948.
A Columbia State Bank spokesperson couldn’t be reached for comment Saturday.
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Reporter Tom Callis can be reached at 360-417-3532 or at tom.callis@peninsuladailynews.com.
