The Washington Department of Financial Institutions closed Rainier Pacific Bank at 6 p.m. Friday, citing inadequate capital and severe loan losses. Immediately following the closure, DFI named the Federal Deposit Insurance Corp. as receiver of Rainier Pacific Bank.

The FDIC immediately entered into a purchase and assumption agreement with Umpqua Bank, headquartered in Roseburg. The Oregon-based unit will assume all deposits and certain assets of Rainier Pacific Bank, except certain brokered deposits, which will be paid out by the FDIC.

"In these challenging economic times we are always disappointed when a bank is unable to continue safe and sound financial operations," DFI Director Scott Jarvis said.

"Umpqua is well positioned to assume the deposits and loans of Rainier Pacific Bank and we will work quickly to make this transition as smooth as possible for customers and employees," its holding company's president and CEO Ray Davis said

Rainier Pacific Bank had branches located in Pierce and King counties and all will be assumed by Umpqua Bank. Thirteen of its 14 branches were opened Saturday as Umpqua Bank branches for normal Saturday banking hours. All locations including the main office will reopened this morning.

Customers seeking more information about the closure should visit the DFI Web site, FDIC site or www.rainierpac.com.