OLYMPIA – The Washington Department of Financial Institutions (DFI) closed Shoreline Bank in Shoreline, Wash. today, citing inadequate capital and severe loan losses. Immediately following the closure, DFI named the Federal Deposit Insurance Corporation (FDIC) as receiver of Shoreline Bank.
The FDIC immediately entered into a purchase and assumption agreement with GBC International Bank headquartered in Los Angeles, Calif. GBC International Bank will assume a majority of the deposits and assets of Shoreline Bank. A limited amount of the bank’s assets will be retained and certain brokered deposits will be paid out by the FDIC.
“Shoreline Bank has suffered significant loan losses associated with land development and construction lending. These losses have depleted the bank’s capital resulting in critical undercapitalization,” Brad Williamson, Director of DFI’s Division of Banks explained. “The bank’s management was not able to raise sufficient capital to remain viable. ”
“Shoreline Bank is yet another unfortunate casualty of the extraordinary weakness in the commercial real estate land acquisition and construction lending market,” DFI Director Scott Jarvis said. “We are pleased, however, that GBC International Bank has stepped up to the plate to acquire Shoreline Bank.”
Shoreline Bank, headquartered in Shoreline, Wash. has three branches, all located in Shoreline. The North 175th Street location will reopen on Saturday and the remaining two locations will reopen Monday as branches of GBC International Bank.
Throughout the weekend and transition, Shoreline 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 June 30, 2010, Shoreline Bank had total assets of $104,208,000 and total deposits of $100,192,000.