IndyMac Bank Shut Down By Feds!
July 11, 2008
IndyMac Bank’s assets were seized by federal regulators on Friday after succumbing to the pressures of tighter credit, tumbling home prices and rising foreclosures.
On July 11, 2008, IndyMac Bank, F.S.B., Pasadena, CA was closed by the Office of Thrift Supervision (OTS) and the Federal Deposit Insurance Corporation (FDIC)was named Receiver. All non-brokered insured deposit accounts have been transferred to IndyMac Federal Bank, F.S.B., Pasadena, CA (”assuming institution”) a new FDIC-insured Federal Mutual Savings Bank. No advance notice is given to the public when a financial institution is closed.
The FDIC has assembled useful information regarding your relationship with this institution. Besides a checking account, you may have Certificates of Deposit, a business checking account, a Social Security direct deposit, and other relationships with the institution.
Please select the link below to read more about this event:
FDIC Bank Closing Information for IndyMac
Less than a week after Michael W. Perry, CEO of Indymac shuttered nearly 4,000 jobs in an attempt to keep the bank afloat, Indymac succumbed as another victim of the sub-prime crisis.
Last week in a statement in response to consumer fears, the FDIC said it was unlikely that the bank would be shut down.
“Such fears are unfounded, according to the Federal Deposit Insurance Corp. The agency says it nearly always finds another institution to take over deposits without a delay and, if that can’t be done, provides checks for insured deposits within one or two business days after a bank failure.”
The Office of Thrift Supervision said it transferred IndyMac’s operations to the Federal Deposit Insurance Corporation because it did not think the lender could meet its depositors’ demands.
IndyMac customers with funds in the bank were limited to taking out money via automated teller machines over the weekend, debit card transactions or checks, regulators said.
Other bank services, such as online banking and phone banking were scheduled to be made available on Monday.
The bank is the largest regulated thrift to fail and the second largest financial institution to close in U.S. history, regulators said.
“This institution failed today due to a liquidity crisis,” OTS Director John Reich said.
IndyMac had $32.01 billion in assets as of March 31.
The banking regulator said it closed IndyMac after customers began a run on the lender following the June 26 release of a letter by Sen. Charles Schumer, D-N.Y., urging several bank regulatory agencies that they take steps to prevent IndyMac’s collapse.
In the 11 days that followed the letter’s release, depositors took out more than $1.3 billion, regulators said.
The FDIC planned to reopen the bank on Monday as IndyMac Federal Bank, FSB.
About the Author:
Robin Sing-Cunningham, is a real estate agent serving Fort Lauderdale and Broward County, Florida. Robin specializes in distressed and bank owned properties in the Fort Lauderdale real estate area.
Robin began her blog recently after over seven years in the real estate business. She brings a unique perspective to her writing as she has worked on the building and development side of the business and has worked extensively with investors on the foreclosure side of the business.
Robin is an avid sport fishing enthusiast and when not selling real estate can usually be found off the coast of Fort Lauderdale looking for that next big game fish.
She's also the wife of one of the hosts of the #1 real estate related talk radio show in America Real Estate Radio USA and occasionally makes appearances on the show to talk about Fort Lauderdale real estate and to lend her perspective on the industry.
You can contact Robin at 954-709-7461 or visit the Fort Lauderdale Real Estate Blog. You can also email Robin at robins@robinashley.com
[...] show with the news about Indymac bank closing its doors. Barry C wrote a blog post titled, “IndyMac Bank Shut Down By Feds!” that we discussed in detail on the show [...]
I wonder how this will affect investors and investing? My thinking is that this is good for investing as Indymac asset managers are going to want to dump whatever they are sitting on.