OAK HARBOR, Wash., April 16, 2010 (GLOBE NEWSWIRE) -- Washington Banking Company (Nasdaq:WBCO), today announced that its subsidiary, Whidbey Island Bank, has acquired the eight branch locations and approximately 60% of the assets and all non-brokered deposits of City Bank, located in Lynnwood, Washington, through a purchase and assumption agreement with the Federal Deposit Insurance Corporation (FDIC).
"This acquisition presents a great opportunity for us to strengthen our geographic footprint by deepening our customer relationships and enhancing our distribution network," said Jack Wagner, President and Chief Executive Officer. "The branch network we are acquiring is just south of our existing network of banking offices, with no overlap. Consequently, we hope that most of the employees of City Bank will be able to continue their banking careers with us and will be available to continue serving their customers. We expect the only changes for the customers and employees of City Bank will be expanded conveniences with additional branch locations, a broader line of banking products and services and better access to loans.
"For our investors, we believe this transaction will be very attractive and accretive to earnings this year," Wagner continued. "The FDIC excluded approximately $328 million in brokered deposits, $180 million in other real estate owned and $132 million of non-performing loans from the bidding process, which was instrumental in reducing the risk and allowing us to proceed with this transaction."
City Bank depositors will automatically become depositors of Whidbey Island, and deposits will continue to be insured by the FDIC. Normal Saturday operations will proceed as usual and customers may also access their accounts through automated teller machine transactions, checks, online banking and debit card transactions. Checks drawn on City Bank will continue to be accepted and processed. Loan customers should continue to make payments as usual.
"We are delighted to welcome the customers and employees of City Bank to the Whidbey Island Bank family, and we want to assure depositors that they are now banking with one of the most financially sound institutions in the State of Washington," said Wagner. "Customers will be able to conduct business as usual at their existing branch locations with their familiar banking associates."
Financial Highlights
Washington Banking's acquisition of the City Bank franchise is expected to provide the following:
- Eight additional full-service locations including six offices in Snohomish County and two in King County;
- A highly-experienced group of relationship managers with average tenure of 13 years;
- Assets of approximately $635 million, or 56% of City Bank's total assets as of a week ago;
- Loans of approximately $425 million (before fair value adjustments), or 65% of gross loans;
- A loan portfolio that has less than 12% in the construction and development category;
- Deposits of approximately $650 million, or 70% of City Bank's total deposits;
- Cash and cash equivalents of approximately $100 million;
- Short term high quality securities of approximately $14 million;
- Loss share protection from the FDIC for covered assets;
- Be accretive to book value per share and tangible book value per share; and
- Upon completion of the acquisition, Washington Banking Company will continue to remain extremely "well capitalized" by regulatory standards, with no additional capital required to support this transaction. The Company is expected to have total assets of approximately $1.7 billion upon completion of the acquisition.
Advisory services for the transaction were provided to Washington Banking Company by FIG Partners LLC.
About Washington Banking Company
Washington Banking Company is a bank holding company based in Oak Harbor, Washington, that operates Whidbey Island Bank, a state-chartered full-service commercial bank. Founded in 1961, Whidbey Island Bank provides various deposit, loan and investment services to meet customers' financial needs. The acquisition expands Whidbey Island Bank's operations to 26 full-service branches located in six counties in Northwestern Washington.
This press release includes forward-looking statements within the meaning of the "Safe-Harbor" provisions of the Private Securities Litigation Reform Act of 1995, which management believes are a benefit to shareholders. These statements are necessarily subject to risk and uncertainty and actual results could differ materially due to various risk factors, including those set forth from time to time in our filings with the SEC. You should not place undue reliance on forward-looking statements and we undertake no obligation to update any such statements. In this press release we make forward-looking statements about our ability to raise common capital, the amount of capital we intend to raise and our intended use of that capital. Specific risks that could cause results to differ from the forward-looking statements are set forth in our filings with the SEC and include, without limitation, negative reaction to our public offering, unfavorable pricing of the offering and deterioration in the economy or our loan portfolio that could alter our intended use of the capital. www.wibank.com