Home Federal Bank of Nampa, Idaho, didn’t have a single bank branch in Oregon four years ago.

But spurred by the failure of two Central Oregon banks in 2009 and 2010, Home Federal has become one of the region’s largest players in the banking industry, with more offices in Oregon than it has in its home state of Idaho, according to the Federal Deposit Insurance Corp.

Nationwide, more than 450 bank failures in the last five years have transformed the financial landscape.

Oregon has felt the impact, with big banks absorbing midsized banks and midsized banks absorbing community banks.

Just 52 percent of banks doing business in the state were headquartered in Oregon at the end of 2012, according to data from the FDIC and the Oregon Bankers Association.

That’s down from 93 percent of the operating banks in 1994.

“For some, being taken over by these bigger banks may have been the opportunity they needed to get more resources to make loans,” said Ralph Cole, senior vice president of research with Portland financial consulting firm Ferguson Wellman Capital Management.

“But as we all know with a change like that, you lose some of that community bank feel.”

Across Central Oregon, local or regional financial institutions like Community First Bank, LibertyBank and Columbia River Bank are gone. They got caught up in the building boom, doling out construction loans that defaulted in droves starting in 2008.

But even some state banks that didn’t fail are being scooped by a handful of midsized, regional banks eyeing expansions across the Northwest.

Two institutions in particular — Home Federal and Tacoma, Wash.-based Columbia State Bank — have grown since 2009, acquiring failed and troubled banks across Oregon and stepping into the Central Oregon market for the first time.

“There have been too many banks for years,” said Len Williams, Home Federal’s president and CEO.

Home Federal acquired Prineville-based Community First in August 2009. In July 2010 it acquired LibertyBank, founded in Bend, but based in Eugene.

Williams called those purchases good for Central Oregon — the two banks were virtually frozen because of their low capital levels and unable to lend to local residents, he said.

Banks need to have at least 10 percent of their total assets backed up by cash reserves to be considered “well capitalized” by the FDIC, known as a risk-based capital ratio.

LibertyBank and Community First had capital ratios of about 4 percent when Home Federal purchased them, according to the FDIC. When Home Federal made the acquisitions, its capital ratio was above 30 percent.

“We worked through some credit issues” with LibertyBank and Community First, Williams said. “But we were looking to enter (the Central Oregon) market… I think we’ve entered a stage where we’ll see more banks come together and talk about long-term strategies.”

Change through mergers

Failed banks aren’t the only ones being acquired. Several mergers involving Oregon state-chartered banks were announced in 2012.

Seattle-based Washington Federal completed in October its acquisition of South Valley Bank and Trust, which had headquarters in Klamath Falls and eight branches in Central Oregon.

Spokane-based AmericanWest Bank announced in October its plans to acquire Medford-based PremierWest Bank, which also has two branches in the High Desert.

Columbia State Bank last week finalized its acquisition of Lake Oswego-based West Coast Bancorp, which had two branches in Bend until 2011.

While the number of banks operating in Oregon has pretty much held steady over the last 20 years, the number of banks headquartered in the state has steadily declined, noted Linda Navarro, president of the Oregon Bankers Association.

That’s important, she said, because local banks often support a wide variety of community efforts, sponsoring local events and spearheading fundraisers.

“In a small town in America, a bank might have some of the best jobs in that town,” Navarro said. “It might be one of the biggest contributors in that town to support schools and local nonprofits. I think any time a state has companies headquartered in that state, that’s a positive thing for local economies.”

But Columbia State Bank officials said there isn’t much distinction between where they’re headquartered and where they serve customers.

“We don’t really consider ourselves an out-of-state bank,” said Mark Nelson, Columbia State Bank’s chief operating officer. “We’ve been in Oregon a long time, 10 years now. We do business there just like we do here in Washington.”

The move meant the loss of an Oregon-headquartered bank. But Columbia State’s purchase kept Columbia River’s roughly $1 billion in assets from becoming insolvent.

Other out-of-state institutions have pledged money specifically to help Oregon communities hard-hit by the economic crash. Washington Federal announced in January a $250 million community development pledge to provide affordable housing loans and financing for economic development projects, three months after wrapping up its acquisition of South Valley.

Nelson said regional banks can duplicate the outreach and fundraising efforts of smaller, community banks.

“We’re very involved in communities in Oregon. We intend to make good, sound investments there, and be good partners with the communities we serve,” he said.