Businessweek

Washington Banking Company operates as the bank holding company for Whidbey Island Bank that provides community commercial banking services. The company's business, which is focused in the northern area of western Washington, consists primarily of attracting deposits from the general public and originating loans. It also offers nondeposit managed investment products and services, which are not Federal Deposit Insurance Corporation (FDIC) insured. These programs are provided through the investment advisory companies, Elliott Cove Capital Management LLC and DFC Services & DFC Insurance Services. Another nondeposit product offered through the Bank, which is not FDIC insured, is a sweep investment option available through a brokerage account. Market Areas The company provides services through 30 bank branches in 6 counties located in northwestern Washington. Its primary market area consists of Island, King, San Juan, Skagit, Snohomish, and Whatcom counties. Loan Portfolio The company’s loan portfolio comprises the following loan types: Commercial Loans: Commercial loans include both secured and unsecured loans for working capital and expansion. Short-term working capital loans are secured by accounts receivable, inventory and/or equipment, while longer-term commercial loans are usually secured by equipment. Real Estate Mortgage Loans: Real estate loans consist of two types, one-to-four family residential and commercial properties. One-to-Four Family Residential Loans: One-to-four family residential loans are secured principally by 1st deeds of trust on residential properties principally located within the company’s market area. Commercial Real Estate Loans: Commercial real estate loans are secured principally by manufacturing facilities, apartment buildings and commercial buildings for office, storage, and warehouse space. Real Estate Construction Loans: Real estate construction loans consist of three types: commercial real estate, one-to-four family residential construction, and speculative construction. Commercial Real Estate: Commercial real estate construction loans are primarily for owner-occupied properties. One-to-Four Family Residential: One-to-four family residential construction loans are for the construction of custom homes, where the homebuyer is the borrower. Land Development: Land development loans are principally secured by land, which has been improved with the installation of utilities and infrastructure, to support building construction. Raw Land: Raw land loans are principally secured by unimproved land where the borrower intends future development of the property. Consumer Loans: The company’s consumer loan portfolio consists of automobile loans, boat and recreational vehicle financing, home equity and home improvement loans, and miscellaneous secured and unsecured personal loans. Direct Consumer Loans: Direct consumer loans consist of automobile loans, boat and recreational vehicle financing, home equity and home improvement loans, and miscellaneous secured and unsecured personal loans originated directly by the company. Indirect Consumer Loans: The company makes loans for new and used automobile and recreational vehicles that are originated indirectly by selected dealers located in the company’s market areas. Investment Portfolio As of December 31, 2011, the company’s investment portfolio included securities of U.S. government agencies, U.S. treasuries, pass-through securities, taxable state and political subdivisions, tax exempt state and political subdivisions, corporate obligations, and investments in mutual funds and other equity securities. Deposits As of December 31, 2011, the company’s deposits included interest-bearing demand and MMA deposits, savings deposits, time deposits, demand and other noninterest-bearing deposits, brokered time deposits, mutual fund money market deposits, and Certificate Deposit Account Registry System deposits. Supervision and Regulation The company is a bank holding company within the meaning of the Bank Holding Company Act of 1956 (BHC Act) registered with and subject to examination by the Board of Governors of the Federal Reserve System and the Federal Reserve Bank of San Francisco (FRB). The bank is a Washington state-chartered commercial bank and is subject to examination, supervision and regulation by the Washington State Department of Financial Institutions–Division of Banks (Division). The FDIC insures the bank’s deposits and in that capacity also regulates the bank. History Washington Banking Company was founded in 1996.