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Frontier Bank shut down; reopens as Union Bank
POULSBO — Frontier Bank branches in Poulsbo reopened Monday with a new banners above their doors.
Everett-based Frontier Bank was closed by the Washington Department of Financial Institutions on Friday and turned over to the Federal Deposit Insurance Corporation according to an FDIC news release. The FDIC transferred Frontier's assets to Union Bank of San Francisco.
Union took over all 51 of Frontier's locations, including branches in Poulsbo, Silverdale, Bremerton and on Bainbridge Island. Former Frontier customers can access their accounts through Union Bank and the accounts are still insured by the FDIC.
Frontier struggled for several years before its shutdown Friday.
The bank lost $258.8 million in 2009 according to a revised year end financial statement issued March 16. It lost $70.2 million in the last three months of 2009.
The FDIC and Washington Department of Financial Institutions issued a "cease and desist" order to Frontier in March 2009 for "unsafe or unsound banking practices and violations of law and/or regulations." The order gave Frontier a litany of banking practices to follow, including writing a plan for avoiding risk.
In March, the FDIC gave Frontier an April 15 deadline to either raise capital or be bought by another bank. The deadline passed without action. On April 27 Frontier issued a statement denying rumors it was being purchased by an investment group.
Frontier was one of seven U.S. banks shut down April 30.
Union Bank is taking on $3.5 billion of Frontier's assets, including $3.13 billion in deposits according to the FDIC. Union will take on nearly all of Frontier's failed loans.