On the verge of taking control of Vancouver’s First Independent Bank, Spokane-based Sterling Financial Corp. is laying off 6 percent of its employees. Those cuts mean that about 160 employees are likely facing pink slips across the bank’s five-state service area.
The layoffs were disclosed to the Securities and Exchange Commission in a Friday regulatory filing by Sterling Financial, parent to Sterling Savings Bank, and were reported by North Bay Business Journal in Northern California. Marty Dickinson, corporate communications executive for Sterling Savings Bank, said Monday she was unable to provide information about the number of layoffs in Oregon and Washington because the bank was closed for the President’s Day holiday. Sterling’s 177 branches include 71 in Washington and 67 in Oregon.
The cuts are in addition to previously announced staff reductions tied to Sterling’s acquisition of First Independent Bank’s core operations, which becomes effective Feb. 29. Sterling says it will shrink First Independent’s workforce by about 8 percent through layoffs and retirements when it assumes control of First Independent’s banking services.
Sterling Financial had 2,496 full-time-equivalent employees at the end of 2011. The Sonoma Bank in California, owned by Sterling, had 182 employees last November, the North Bay Business Journal reported.
“Given the challenging interest rate environment and the uncertain economic outlook, Sterling must position itself for continued success, including lowering its operating expenses,” Greg Seibly, chief financial officer of Sterling Financial, said in the regulatory filing. “Sterling has fewer assets today than it did just a few years ago and, although this has been a difficult decision, the bank needs to appropriately reflect that reality.”
Sterling’s assets peaked at $12.82 billion in the first quarter of 2011 and were $9.19 billion at the end of 2011, bank officials told the North Bay Business Journal.
In announcing its acquisition of First Independent last fall, Seibly said the bank aims to strengthen its market share in the Portland-Vancouver area as part of a larger strategy to grow in the Interstate 5 corridor. With $6.5 billion in deposits at the end of 2011, it has the eighth-largest deposit share
in Washington and seventh largest in Oregon.
Its acquisition of the 14-branch First Independent, with $680 million in deposits at the end of 2011, will move Sterling from 12th place to seventh place in deposit market share for the Portland-Vancouver metropolitan area, according to the SEC filing.
Sterling Financial Corp. also informed regulators that it will shorten the bank’s name to Sterling Bank, completing the bank’s evolution from its roots as a thrift to a full-service commercial bank. Sonoma bank will retain its name due to trademark restrictions, Sterling said. The bank will launch a new Sterling Bank website, http://www.bankwithsterling.com, next month and will replace signs to reflect its new name over a two-year period, beginning with Spokane, Portland-Vancouver and Seattle.
