FDIC seizes Frontier Bank; Union Bank of California takes over

Published 1:23 pm Thursday, May 6, 2010

EVERETT — Frontier Bank branches have reopened under a new name: Union Bank.

Frontier Financial Corp., the parent company of the long-time Everett institution, was closed by state regulators at 6 p.m. April 30. In nearly seamless succession, the Federal Deposit Insurance Corp. immediately assumed receivership of the bank and sold it to Union Bank NA, based in San Francisco.

The sale marks the end of a long fight by Frontier. Under increased scrutiny from regulators for more than a year, the bank has long struggled to break free from bad real estate loans and find investors to stop large losses.

Regulators started pounding the final nails in Frontier’s coffin earlier this year when it labeled the bank “critically undercapitalized” and told its officials to turn things around by April 15 or risk being sold to the highest bidder.

Frontier is the sixth Washington-based bank to be closed this year, according to FDIC data. City Bank of Lynnwood preceded Frontier on the failed-bank list in April when regulators sold the foreclosure-plagued institution to Oak Harbor-based Whidbey Island Bank.

In 2009, 140 banks were shuttered across the U.S, the highest number in nearly two decades.

Effective immediately, all Frontier depositors are customers of the bank’s new owners. Former Frontier branches will close over the weekend and reopen Monday. ATMs and drive-up banking stations will be open for business throughout the weekend, and online banking will be available as usual.

This timeline shows what happened to Frontier Bank:

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Amy Rolph: 425-339-3029, arolph@heraldnet.com.