Posted on Friday, 30th April 2010 by Christopher Allen
San Francisco-based Union Bank purchased the failed Frontier Bank in Everett, Wash., in an FDIC-assisted transaction.
It was Union Bank’s second purchase of a failed bank this month. Union Bank purchased San Rafael-based Tamalpais Bank, which failed April 16, with assistance from the Federal Deposit Insurance Corp.
Union Bank assumed about $2.5 billion in deposits of Frontier, which had $3.5 billion in assets. Union Bank paid no premium for the deposits and assumed all of the failed bank’s assets. The bank entered a loss-sharing agreement with the FDIC on $3.04 billion of Frontier’s assets.
Frontier Bank had 47 branches in western Washington. The failed bank also had one branch each in the Oregon cities of Portland, Salem and Tigard, as well as a loan production office in Keizer, Ore.
Union Bank, through its predecessor Bank of California, had a small presence in Washington state for more than a century.
“We have been looking for the right opportunity to expand in the region for some time and Frontier Bank’s commercial and consumer businesses match well with our own, particularly in retail and corporate banking, and wealth management,” said Masaaki Tanaka, president and CEO of Union Bank.
The FDIC estimates Frontier’s failure will cost its deposit insurance fund $1.37 billion.
Union Bank, with $85 billion in assets, operates 346 banking offices in California, Oregon, Washington and Texas and two international offices.
The bank’s parent, UnionBanCal Corp., is owned by Mitsubishi UFJ Financial Group Inc., (NYSE: MTU) one of the world’s largest financial institutions.
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Tags: Failed Bank, Union Bank, Wash
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