OLYMPIA - The Washington Department of Financial Institutions (DFI) closed Horizon Bank today, citing inadequate capital and severe loan losses. Immediately following the closure, DFI named the Federal Deposit Insurance Corporation (FDIC) as receiver of Horizon Bank.
The FDIC immediately entered into a purchase and assumption agreement with Washington Federal, headquartered in Seattle, Washington. Washington Federal will assume all deposits and certain assets of Horizon Bank, excluding certain brokered deposits.
“Horizon’s capital has been depleted by large loan losses,” Brad Williamson, Director of DFI’s Division of Banks explained. “Like many banks across the country, Horizon’s real estate construction and development portfolio has suffered as real estate values have fallen.”
“While we are always disappointed when a bank is unable to continue safe and sound financial operations,” DFI Director Scott Jarvis said, “we are very pleased to see a bank with deep roots in Washington undertaking a whole bank purchase, insuring the deposits and loans of individuals, businesses and public entities throughout Washington.”
Horizon Bank, headquartered in Bellingham, Wash. has branches located in Whatcom, Skagit, Snohomish and Pierce counties. All will be assumed by Washington Federal. Branches that provide drive-up services on Saturday will reopen on Saturday with normal business hours as branches of Washington Federal. The main office and all of Horizon’s 18 branches will reopen on Monday, Jan. 11 as branches of Washington Federal.
Throughout the weekend and transition, Horizon 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, 2009, Horizon Bank had total assets of $1,299,986,000 and total deposits of $1,174,360,000.
Washington Federal operates 150 offices in Washington, Oregon, Idaho, Utah, Nevada, Arizona, Texas and New Mexico. Established in 1917, the company provides residential real estate loans, commercial real estate financing, consumer deposit accounts and business banking. On September 30, 2009, the company reported $12.6 billion in assets, $7.8 billion in deposits and $1.7 billion in stockholders’ equity.