On Friday, the Washington Department of Financial Institutions closed Evergreen Bank, headquartered in Seattle, Washington, and the FDIC was named receiver. As receiver, the FDIC entered into a purchase and assumption agreement with Umpqua Bank, headquartered in Roseburg, Oregon, to assume all of the deposits of Evergreen Bank. Umpqua Bank will pay the FDIC a premium of 1% to assume all of the deposits of Evergreen Bank. In addition, the FDIC acquired a “cash participation instrument” that “serves as additional consideration for the transaction.”

As of September 30, 2009, Evergreen Bank had approximately $488.5 million in total assets and $439.4 million in total deposits. Umpqua Bank also agreed to purchase essentially all of the failed bank’s assets. The FDIC and Umpqua Bank entered into a loss-share transaction on $379.5 million of Evergreen Bank’s assets.

The FDIC estimates that the cost to the Deposit Insurance Fund will be $64.2 million. Evergreen Bank is the eighth FDIC-insured institution to fail in the nation this year and the second to fail in Washington.