Oct 4 – Shoreline Bank, Shoreline, Washington, has been closed by the Washington Department of Financial Institutions, which appointed the Federal Deposit Insurance Corporation as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with GBC International Bank, Los Angeles, California, to assume all of the deposits of Shoreline Bank.
The three branches of Shoreline Bank will reopen during their normal business hours beginning Saturday as branches of GBC International Bank. Depositors of Shoreline Bank will automatically become depositors of GBC International Bank. Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship in order to retain their deposit insurance coverage. Customers of Shoreline Bank should continue to use their existing branch until they receive notice from GBC International Bank that it has completed systems changes to allow other GBC International Bank branches to process their accounts as well.
This evening and over the weekend, depositors of Shoreline Bank can access their money by writing checks or using ATM or debit cards. Checks drawn on the bank will continue to be processed. Loan customers should continue to make their payments as usual.
As of June 30, 2010, Shoreline Bank had approximately $104.2 million in total assets and $100.2 million in total deposits. GBC International Bank will pay the FDIC a premium of 0.25 percent to assume all of the deposits of Shoreline Bank. In addition to assuming all of the deposits of the failed bank, GBC International Bank agreed to purchase approximately $65.7 million of the failed bank’s assets. The FDIC will retain the balance of the assets for later disposition.
The FDIC and GBC International Bank entered into a loss-share transaction on $49.2 million of Shoreline Bank’s assets. GBC International Bank will share in the losses on the asset pools covered under the loss-share agreement. The loss-share transaction is projected to maximize returns on the assets covered by keeping them in the private sector. The transaction also is expected to minimize disruptions for loan customers. For more information on loss share, please visit: www.fdic.gov/bank/individual/failed/lossshare/index.html.
Customers who have questions about today’s transaction can call the FDIC toll-free at 1-800-613-0378. The phone number will be operational this evening until 9:00 p.m., Pacific Daylight Time (PDT); on Saturday from 9:00 a.m. to 6:00 p.m., PDT; on Sunday from noon to 6:00 p.m., PDT; and thereafter from 8:00 a.m. to 8:00 p.m., PDT. Interested parties also can visit the FDIC’s Web site at www.fdic.gov/bank/individual/failed/shoreline.html.
The FDIC estimates that the cost to the Deposit Insurance Fund will be $41.4 million. Compared to other alternatives, GBC International Bank’s acquisition was the least costly resolution for the FDIC’s DIF. Shoreline Bank is the 129th FDIC-insured institution to fail in the nation this year, and the tenth in Washington. The last FDIC-insured institution closed in the state was North County Bank, Arlington, on September 24, 2010.