The Oregon Department of Consumer and Business Services Friday ordered the closure of Columbia River Bank and appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. Subsequently, Columbia Bank of Washington acquired essentially all of Columbia River’s assets and liabilities from the FDIC.
Columbia River Bank is headquartered in The Dalles, and it has 21 offices in Oregon and Washington. All deposit accounts of Columbia River Bank are being transferred to Columbia State Bank, and will be available immediately.
According to a statement released Friday by the Washington State Department of Financial Institutions (DFI), Columbia River Bank had been experiencing critically low levels of capital and, ultimately, became insolvent. The bank’s problems resulted primarily from non-performing residential construction loans.
As of Sept. 30, 2009, Columbia River Bank had total assets of approximately $1.1 billion and total deposits of $1.0 billion. Based in Tacoma, Wash., Columbia State Bank has total assets of about $3.2 billion and total deposits of $2.5 billion. Columbia State Bank has 50 offices, with locations on the Oregon coast and in the Portland area.
Because Columbia State Bank is acquiring all of Columbia River Bank’s operations — including its deposits, loans, and the majority of its assets — there will not be any losses for former Columbia River Bank depositors who have deposits exceeding the FDIC Deposit Insurance amount.
There were 140 bank closures nationwide in 2009, including three in Oregon, and several banks have closed nationwide in the early weeks of 2010. According to DFI, a heavy concentration of real estate loans is plaguing banks in Oregon and throughout the region. With the downturn in the housing market and increased softness in the commercial property market, the makers of those loans cannot repay them. Many banks are in critical need of capital to help them weather the downturn.
The FDIC has established a Web site and a toll-free phone number to answer questions from depositors, creditors, and other interested parties regarding the receivership of Columbia River Bank. The Web site is http://www.fdic.gov/bank/individual/failed/columbiariver.html , and the toll-free phone number is 1-800-523-0640.