Feds Take Over IndyMac

From the CBC:

Bank regulators seized California-based mortgage lender IndyMac Bancorp Inc. on Friday afternoon after panicky depositors began withdrawing their money, leaving the institution short on cash.

IndyMac customers with funds in the bank will be limited to taking out money over the weekend through automated teller machines, debit card transactions or cheques, regulators said.

The bank will reopen on Monday as IndyMac Federal Bank under the supervision of the Federal Deposit Insurance Corp., the FDIC said.

David Barr, a spokesperson for the FDIC , which insures deposits in American banks, said the insurance agency is trying to find a buyer for IndyMac.

"This bank is now being operated by the FDIC. IndyMac is the second largest federally insured financial company to be seized by regulators. 

From the New York Times:

 

 

Federal regulators seized IndyMac Bancorp on Friday evening, marking one of the largest bank failures in American history.

The closure followed a frenzied week during which IndyMac’s executives tried to bolster the ailing bank. Most of IndyMac’s deposits are guaranteed by the Federal Deposit Insurance Corporation, which will operate the bank and try to sell it.

The run on the bank came after a critical letter about the bank from Senator Charles E. Schumer, Democrat of New York. Before Mr. Schumer’s letter, the bank had been receiving net inflows of money from depositors, Mr. Reich said.

IndyMac held $32 billion in assets as of late March, according to the government release.

The largest bank failure on record was in 1984 when Continental Illinois National Bank and Trust in Chicago hit trouble, presaging the savings and loan crisis.

Bank failures so far pale against the 3,000 bank failures in the 1980s, he said.

 

About Luke Ford

Raised a Seventh-Day Adventist at Avondale College in Australia, Luke Ford moved to California in 1977. He graduated from Placer High School in 1984, reported the news at KAHI/KHYL radio for three years, attended Sierra College and UCLA, was largely bedridden by Chronic Fatigue Syndrome for six years, and converted to Judaism in 1993. From 1997-2007, Luke made his living from blogging. Living by Beverly Hills (Alexander90210.com), he now teaches the Alexander Technique (moving the way the body likes to move). Lessons cost $100 each and last about 45 minutes. In 2011, Luke completed a three-year teaching course at the Alexander Training Institute of Los Angeles. His personal Alexander Technique website is Alexander90210.com. Luke is the author of five books, including: » The Producers: Profiles in Frustration » Yesterday’s News Tomorrow: Inside American Jewish Journalism
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