Interwest Bancorp in Oak Harbor, Wash., said this week that it would take an $11 million charge this quarter to account for severance packages, consolidation of its three banking subsidiaries, and restructuring of its investment portfolio.
Last month the $2.8 billion-asset thrift company announced plans to convert its Interwest Bank from a state savings bank to a commercial bank and to consolidate its other subsidiaries under the Interwest Bank charter. The plan, expected to be completed in 2001, also prompted the company to restructure its investment portfolio by selling certain long-term securities and reinvesting in shorter-term instruments with higher yields.
Interwest recently announced several management changes, including the resignation of its longtime CEO. It also expects to cut about 100 jobs next year as part of the restructuring.
Estimated expenses include a loss of $4.4 million associated with securities sales, $2.5 million of conversion costs, $2 million for severance agreements, $1.3 million for reassessed real estate investments, and $800,000 of goodwill from the acquisition of a mortgage broker.