Associated Press - October 15, 2009 2:44 PM ET

SPOKANE, Wash. (AP) - Sterling Financial Corp. must raise $300 million to solidify capital under an agreement reached with federal and state regulators.

The largest bank based in Washington state also announced the appointment of a new management team. Co-founder and chairman Harold Gilkey has stepped down, and will be replaced by acting Chairman William Eisenhart.

Sterling, with $12.4 billion in assets, has struggled with steep losses, particularly on real estate loans.

In the deal with the Federal Deposit Insurance Corp. and Washington Department of Financial Institutions, Sterling agreed to develop new plans for maintaining adequate capital, reduce commercial real estate loans, and cut off loans to troubled borrowers, all within 60 days.

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