Evergreen Bank, Seattle, Washington, was closed today by the Washington Department of Financial Institutions, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Umpqua Bank, Roseburg, Oregon, to assume all of the deposits of Evergreen Bank.
The seven branches of Evergreen Bank will reopen on Monday as branches of Umpqua Bank. Depositors of Evergreen Bank will automatically become depositors of Umpqua Bank. Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship to retain their deposit insurance coverage. Customers should continue to use their existing branch until they receive notice from Umpqua Bank that it has completed systems changes to allow other Umpqua Bank branches to process their accounts as well.
This evening and over the weekend, depositors of Evergreen Bank can access their money by writing checks or using ATM or debit cards. Checks drawn on the bank will continue to be processed. Loan customers should continue to make their payments as usual.
As of September 30, 2009, Evergreen Bank had approximately $488.5 million in total assets and $439.4 million in total deposits. Umpqua Bank will pay the FDIC a premium of 1.0 percent to assume all of the deposits of Evergreen Bank. In addition to assuming all of the deposits of the failed bank, Umpqua Bank agreed to purchase essentially all of the assets.
The FDIC and Umpqua Bank entered into a loss-share transaction on $379.5 million of Evergreen Bank's assets. Umpqua Bank will share in the losses on the asset pools covered under the loss-share agreement. The loss-share transaction is projected to maximize returns on the assets covered by keeping them in the private sector. The transaction also is expected to minimize disruptions for loan customers. For more information on loss share, please visit: http://www.fdic.gov/bank/individual/failed/lossshare/index.html.
Customers who have questions about today's transaction can call the FDIC toll-free at 1-800-528-6215. The phone number will be operational this evening until 9:00 p.m., Pacific Standard Time (PST); on Saturday from 9:00 a.m. to 6:00 p.m., PST; on Sunday from noon to 6:00 p.m., PST; and thereafter from 8:00 a.m. to 8:00 p.m., PST. Interested parties also can visit the FDIC's Web site at http://www.fdic.gov/bank/individual/failed/evergreen-wa.html.
As part of this transaction, the FDIC will acquire a cash participant instrument. This instrument serves as additional consideration for the transaction.
The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $64.2 million. Umpqua Bank's acquisition of all the deposits was the "least costly" resolution for the FDIC's DIF compared to all alternatives. Evergreen Bank is the eighth FDIC-insured institution to fail in the nation this year, and the second in Washington. The last FDIC-insured institution closed in the state was Horizon Bank, Bellingham, on January 8, 2010.
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Congress created the Federal Deposit Insurance Corporation in 1933 to restore public confidence in the nation's banking system. The FDIC insures deposits at the nation's 8,099 banks and savings associations and it promotes the safety and soundness of these institutions by identifying, monitoring and addressing risks to which they are exposed. The FDIC receives no federal tax dollars – insured financial institutions fund its operations.
FDIC press releases and other information are available on the Internet at www.fdic.gov, by subscription electronically (go to www.fdic.gov/about/subscriptions/index.html) and may also be obtained through the FDIC's Public Information Center (877-275-3342 or 703-562-2200). PR-17-2010