Friday, November 05, 2010
Lyn Peters, Director of Communications
PH (360) 902-8731 firstname.lastname@example.org
Brad Williamson, DFI Director, DFI Division of Banks
PH (360) 902-8704 email@example.com
FOR IMMEDIATE RELEASE:
Heritage Bank, Headquartered In Olympia, Wash. Purchases Pierce Commercial Bank After Closure By Washington DFI
OLYMPIA – The Washington Department of Financial Institutions (DFI) closed Pierce Commercial Bank in Tacoma, Wash. today, citing inadequate capital and severe loan losses. Immediately following the closure, DFI named the Federal Deposit Insurance Corporation (FDIC) as receiver of Pierce Commercial Bank.
The FDIC immediately entered into a purchase and assumption agreement with Heritage Bank headquartered in Olympia, Wash. Heritage Bank will assume all of the deposits and assets of Pierce Commercial Bank.
“Pierce Commercial Bank has suffered significant losses associated with real estate lending. Like many institutions, Pierce Commercial Bank has experienced large losses associated with construction and land development loans. Unfortunately, the bank also suffered from poor mortgage lending practices that further impacted the bank’s earnings and capital,” Brad Williamson, Director of DFI’s Division of Banks explained. “Despite continuing efforts, bank’s management was not able to raise sufficient capital to remain viable.”
“The extraordinary weakness in the commercial real estate land acquisition and construction lending market simply left some of our Washington banks, like Pierce Commercial, too vulnerable to survive,” DFI Director Scott Jarvis added. “The closure of a Washington State chartered bank is never a welcome event. However, a very positive signal is sent when Heritage, a financially strong state-chartered bank, steps up to acquire a failing institution.”
Pierce Commercial Bank, headquartered in Tacoma, Wash. has one location which will reopen Monday as a branch of Heritage Bank.
Throughout the weekend and transition, Pierce Commercial Bank customers can access their funds by writing checks or using ATM or debit cards. Checks will continue to be processed. Loan customers should continue to make their payments as usual. Online services also will remain available.
As of Sept. 30, 2010, Pierce Commercial Bank had total assets of $221,082,000 and total deposits of $193,473,000.
For more information about deposit insurance for Washington banks and credit unions, visit www.dfi.wa.gov/consumers/deposits.htm. For details about FDIC coverage and requirements, visit www.fdic.gov or call toll-free 1.877.ASK.FDIC.
DFI also offers answers to frequently asked questions for bank business loan customers in turbulent times at http://dfi.wa.gov/banks/business-loan-faqs.htm.
About Division of Banks
www.dfi.wa.gov/banks ▪ 360.902.8704 ▪ 877.RINGDFI (746.4334) x 28704
The Washington State Department of Financial Institutions Division of Banks regulates 76 Washington State-chartered commercial banks, stock savings banks, mutual savings banks, foreign banks, savings and loan associations and independent trust companies. We charter new banks, business development corporations, trust companies, foreign banks and savings & loan associations. Also, we authorize new branches and branch closures; and approve mergers & acquisitions. Learn more about the Division of Banks.
www.dfi.wa.gov ▪ 360.902-8700 ▪ 877.746-4334
The Washington State Department of Financial Institutions regulates a variety of financial service providers such as banks, credit unions, mortgage brokers, consumer loan companies, payday lenders and securities brokers and dealers. The department also works to improve financial education throughout Washington through its outreach programs and online clearinghouse www.dfi.wa.gov/financial-education. In addition to posting information about licensees and administrative actions, DFI uses the Web and social media to provide financial education information: http://www.twitter.com/FinEd4All, www.twitter.com/DFIConsumers, www.finlit.blogspot.com, www.youtube.com/user/WADFI, www.homeownership.wa.gov.