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Whidbey bank grows, sheds ‘Island’ unofficially
With its impressive profit earnings, top-notch new lending team, and an ever improving reputation, Whidbey Island Bank is once again in the market for new acquisitions.
The operating subsidiary of Washington Banking Company, which started in Coupeville in 1961 and is now headquartered in Oak Harbor, also hopes to solidify its regional presence by relocating some its operational staff to a Burlington office, and by promoting an unofficial name change in specific areas.
Jack Wagner, bank CEO and president of Washington Banking Company’s board of directors, said the firm’s excellent financial footing makes it well suited for further growth albeit it will be picky about new acquisitions.
“We certainly have the capital but it will be based on opportunity,” Wagner said. “We not about growing just for the sake of getting bigger.”
“It just depends on what becomes available,” he said.
The bank’s financial condition has fluctuated greatly over the past few years. Company share prices reached a high in August of 2006 at $18.39 but jumped to $20.94 in October of 2007 just after a merger was announced with Frontier Financial Corporation, parent company of Everett-based Frontier Bank.
However, share prices began dropping almost immediately as the collapse of the housing market affected banks’ bottom line across the county. By June of 2008, the prospective merger with Frontier had fallen through but Whidbey Island Bank shares continued to plummet to $6.09 in March of 2009, a low not seen since 2002.
Wagner and the bank’s chief financial officer, Rick Shields, responded by embarking on a capital raising venture, hitting financial markets up and down the east and west coast. There they pitched the bank’s reputation and plans for growth to investors.
“It was a great success,” Wagner said.
Various investors purchased $51.7 million in new shares. It not only increased the individual price per share, from about $12 to $14, but it also provided the bank with enough capital to expand. In April, it purchased the majority of troubled Lynwood-based City Bank, which increased the number of Whidbey Island Bank branches to 26 and boosted its total assets to $1.6 billion.
In June, the company also employed the services of an Everett-based eight-person lending team led by Tim Coulter. The group, which Wagner said is one of the premiere lending teams out of Snohomish County, had been working for Frontier before it was seized by the Federal Deposit Insurance Corporation, then subsequently sold to Union Bank, earlier this year.
Whidbey Island Bank also picked up high level staff from Horizon Bank, which failed earlier this year.
While the market continues to fluctuate, with shares closing at $12.96 on Aug. 13, the company’s recent decisions appear to be paying off. A June 17 press release announced it was the top performing, locally based, bank in Northwest Washington, Idaho, and Oregon.
Another press release, this one dated July 27, touted the bank’s quarterly statement at $4.6 million, which is a 130 percent increase over the $2 million earned in the previous quarter. That’s a 272 percent increase over the $1.2 million earned in the second quarter of 2009, the release said.
Whidbey Island Bank officials are positioning the bank to be even more successful in the future. Along with plans to move a handful of employees from its bank services department to a Burlington office this October, branches in the Lynwood area will be “promoted” as Whidbey Bank, deleting the “Island.”
While signs over the door, along with promotional products such as cups, will flout the new name, it’s not official, Wagner said. The legal name will remain Whidbey Island Bank and signs at Whidbey branches will remain the same. This is purely a promotional move geared toward off-island customers, who he said find the name more appealing.
“We’re not trying to run from our heritage,” Wagner said. “We’re just trying to run a good business.”