Columbia Banking System Inc. in Tacoma, Wash., and an aggressive buyer of failed banks, rode those acquisitions to a strong fourth quarter.

The $4.8 billion company has purchased three failed banks in recent months. On Thursday, the company said its quarterly earnings rose 17% from a year earlier, to $14.8 million. Full-year 2011 earnings rose 86% from a year earlier, to $48 million.

Columbia bought First Heritage Bank, Summit Bank and Bank of Whitman from the Federal Deposit Insurance Corp. in the past year. The company said that it expects to complete Bank of Whitman's integration by the end of March. The company's branch count grew 21% last year.

Net interest income in the fourth quarter rose 86% from a year earlier, to $72.1 million, because of the FDIC-assisted deals. Loans not covered under the FDIC loss-sharing agreements rose 23% from the fourth quarter of 2010, to $2.4 billion. The net interest margin jumped 279 basis points from a year earlier, to 7.14% in the fourth quarter, because of reduced funding expense, increased loan originations and the redeployment of interest earning deposits with banks into the investment portfolio.

The company had some temporary setbacks, including a $17.4 million change in the FDIC loss-sharing asset and a $3 million impairment charge on investment securities. Also, noninterest expenses rose 18% from a year earlier, to $41.3 million, because of the operating expenses of the three acquired banks.

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