Friday brought the first failure of the year as Horizon Bank in Bellingham, Wash., was closed by state regulators.

The Federal Deposit Insurance Corp. sold the operations of the $1.3 billion-asset bank to Washington Federal Savings and Loan in Seattle. The acquirer assumed all of Horizon's $1.1 billion in deposits, without paying a premium, and also agreed to take over virtually all of its assets. The buyer did sign a loss-sharing agreement with the FDIC on $1 billion of Horizon's loans. The FDIC estimated the failure would cost it $539 million.

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