Wells Fargo buys Pacific Northwest Bank
June 25, 2008 · Updated 4:24 PM
A $3 billion corporation that started in Oak Harbor in the 1950s is merging with Wells Fargo & Co., one of the nation's largest financial services companies.
Dave Straus, president of Pacific Northwest Bancorp, said Wells Fargo wanted to expand in Washington and basically made bank officials an offer they couldn't refuse.
"We didn't have a For Sale sign," he said. "We weren't looking to sell, but they came after us. "
Once the merger is finalized early next year, Pacific Northwest Bank will cease to exist, at least in name, Straus said. He said many of the 170 employees at the Oak Harbor office will be able to continue working for Wells Fargo, but some positions will be eliminated.
Pacific Northwest Bank also has branch offices in Freeland and Clinton.
Last fall, Pacific Northwest Bank officials announced that the company was going to start outsourcing mortgage lending. As a result, about 80 bank employees, including about 40 people in the Oak Harbor office, lost their jobs.
The company was founded in 1957 as Island Savings & Loan in Oak Harbor, but the name was changed to InterWest Bank about 20 years ago. InterWest incorporated in 1994 and began expanding, aggressively purchasing other banks in the region.
In 1998 the company purchased Pacific Northwest Bank and brought the bank's founder, Patrick Fahey, into the company.
Pacific Northwest, with nearly $3.1 billion in assets, currently has more than 800 employees and 58 banking locations in western and central Washington, as well as five locations in Portland. By comparison, Wells Fargo is a $370 billion diversified financial services company with more than 5,800 branches and over 6,000 ATMs.
Under the merger agreement, Fahey will become chairman of regional banking for Wells Fargo in Washington.
The merger, announced Monday, is good news for Pacific Northwest shareholders. The share price shot up from $28.44 Monday to $34.75 Tuesday. Under the terms of the merger, Pacific Northwest shareholders will receive $35 in Wells Fargo common stock for each share.