BREAKING: State shuts down Bank of Whitman

State and federal banking regulators shut down the Bank of Whitman Friday night, transferring much of its assets to Tacoma-based Columbia Banking System.

Eight of the bank's 20 branches will re-open Monday as Columbia State Bank. Twelve branches, including three in Whitman County will be shuttered.

Bank of Whitman is the third bank to be closed in the state this year.

Branches will be closed in Endicott, LaCrosse, Rosalia, Pomeroy, Washtucna, Lind, Warden, Royal City, Mattawa, Pasco, Kennewick and in Spokane on Highway 2.

Accounts with the Bank of Whitman will automatically be transferred to Columbia State Bank. Deposits are insured by the Federal Deposit Insurance Corporation.

Customers of the closed branches will be able to access their accounts at the Columbia State branches in Colfax, Clarkston, Othello, Pullman, Ritzville, Walla Walla or the two Spokane branches.

Bank of Whitman customers will be able to access their money with checks, through ATMs or by using debit cards.

The bank's two top officers, CEO Jim Tribbett and Chief Lending Officer Craig Conklin, resigned Jan. 14, just before it was ordered by the FDIC to raise more capital or merge with another bank. It could not do either.

As of June 30, Bank of Whitman had approximately $548.6 million in total assets and $515.7 million in total deposits. At the end of March, 2010, Bank of Whitman held more than $788 million in assets and $660 million in deposits.

Columbia State Bank will take over Bank of Whitman deposits and has agreed to purchase approximately $314.4 million of the failed bank's assets. The FDIC will take over about $134.8 million of the bank's failed assets.

Bank of Whitman was formed in 1977 by a group of local farmers and businessmen, expanding over the years to open branches in central Washington and Spokane.

Most immediately hurt in the bank failure will be Bank of Whitman employees. Many received stock in the bank's Employee Stock Ownership Plan as their retirement investments. In 2009, the plan held almost $20 million in investments. As the bank lost money, the plan's holdings dipped to negative $708,000

Through the quarter ending March 31 of this year, Columbia State Bank held more than $4.2 billion in assets, with almost $3.5 billion in deposits.

Columbia Banking Systems received $76,898,000 from the federal government through the Troubled Assets Relief Program of 2008. It repaid the TARP loan in August of last year.

Customers with safe deposit boxes at the twelve locations not reopening should call 1-800-881-7816 to set up an appointment to claim the contents of their boxes. Customers will have until August 26, 2011 to access their safe deposit boxes at these locations.