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IndyMac Bank seized by Feds; 2nd-largest bank failure in US history

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The federal government took control of Pasadena-based IndyMac Bank today, in what regulators called the second-largest bank failure in U.S. history.

The Office of Thrift Supervision in Washington, the chief regulator of IndyMac, said it transferred control of the $32-billion bank to the Federal Deposit Insurance Corp.

Regulators said depositors would have no access to banking services online and by telephone this weekend, but could continue to use ATMs, debit cards and checks. Online banking and phone banking services are to resume operations Monday.

Federal authorities said based on a preliminary analysis, the takeover of IndyMac would cost the FDIC between $4 billion and $8 billion.

ndyMac's failure had been widely expected in recent days, as regulators said it was not well-capitalized. Its stock has plummeted to mere pennies a share and some nervous depositors have been pulling their funds. The bank has been reeling from losses on defaulted mortgages made at the height of the housing boom.

"The OTS has determined that the current institution, IndyMac Bank, is unlikely to be able to meet continued depositors' demands in the normal course of business and is therefore in an unsafe and unsound condition," the agency said in a statement today.

IndyMac's failure is second only to the 1984 failure of Continental Illinois Bank, which had assets of $40 billion at the time.
Ogmin

43 responses // IndyMac Bank seized by Feds; 2nd-largest bank failure in US history

  • Kind of sounds like the beggining of a depression. I guess that started about 8 years ago though. Depressions are depressing.
    squeege
  • Wonder where Bear Stearns this year ranks on that list. And we have Fannie Mae and Freddie Mac yet to go. OK, this is getting scary now.
    JohnA
  • Another domino has fallen.
    1percent
  • Yeah, it seems to be coming down faster than anyone expected. Should be an interesting ride...
    Ogmin
    1 response to this
  • Interesting and scary as hell!!

    Oh wait.Thats right.This is all in our heads.nothing to worry about.HA!!
    pissedoffinarkansas
  • Bear Sterns went out this year, one of the oldest and largest stock brokerages in American history, a company that survived the Great Depression. Now Fannie Mae and Freddie Mac, two quasi-governmental, insured companies are on the brink, bound to be bailed out with our tax dollars. The stock market is at it's lowest point in two years. This is scary shit people. Big time scary shit. This is 1929, Herbert Hoover, scary. Pay attention.
    JohnA
  • Huge Lenders Going Under
    http://current.com/items/89093616_huge_lenders_going_un...

    "Fannie Mae and Freddie Mac are so big — they own or guarantee roughly half of the nation’s $12 trillion mortgage market — that the thought that they might falter once seemed unimaginable. But now a trickle of worries about the companies, which has been slowly building for years, has suddenly become a torrent. "
    Ogmin
  • watch this comment being used here, here, here, here, here, and here
    hey now.. no need for alarm.. george will just crank up the magic printer to TURBO and start making more money..

    come monday, the government will have those deposits guaranteed and everyone can keep on pretending that everything is okayyyy..

    fun times ahead..
    chapter12
    2 responses to this
  • "This sounds like just more 'fuzzy math'" as Dubya would say...

    Hold onto your asse(t)s, people... the roller-coaster is about to drop...
    artist_speaks_out
  • So how long will it be till people start pulling money out of their banks.....

    I say Monday...

    Good luck all!
    1percent
    1 response to this
  • Indymac was spun off of Countrywide Financial...anybody want to guess what they have in common ? A former CEO Angelo Mazillo who depleted the retirement accounts of thousands of employees at Countrywide...yet took a 200 million plus golden(platinum) parachute and walked away from all responsibilities by selling out to Bank of America for 2 billion dollars...oh by the way the government gave back to Bank of America the 2 billion dollars...so in essence we the american people are giving the 200 million dollars to Angelo Mazillo...what a crook. How come the media/press has not picked up on this....Mazillo should be put away for life for the theft of retirement funds of employees within Countrywide. Question...since he started Indymac like he started Countrywide...I wonder if he recieved any funds from that side of the spin off ?
    lalfie
  • Supplyside economics. This is where you cut taxes and then discover another problem.....so you cut taxes again......and then you cut taxes again......and then you discover another problem. Then you get the discount rate cut to .75 % for about 2 years.....then you cut taxes again.

    The presidents father named it VOO DOO economics.

    It seemed like a good way to trash the economy so that those Army recruiters wouldn't have to burn so much gas finding cannon fodder for the middle east wars. Then there would be plenty of unemployed kids to send over their.
    cadsuch
  • Frightening. You can also hear the ice cracking beneath our feet.
    damnneargenius
  • What goes down must come up....I hope : (
    Dawn324
    2 responses to this
  • i ALMOST opened a bank account there
    furryjenn
  • KEEP YOUR GOLD AND VALUABLES! ASSETS SUCH AS PROPERTY CAN BE CEASED AT ANY TIME SO BE CAREFUL WHERE YOU PUT YOUR MONEY, BUT PUT IT INTO SOMETHING BECAUSE IT WONT BE WORTH MUCH VERY SOON.
    muffin2062
  • the depression is coming
    unstephenk
  • stop whining, when things get as bad as 1979 start getting scared.
    clayjj05
  • it already is as bad as 1979. In the past 5 years the dollar has devalued by 40 or more. If you received a social security check 5 years ago and waited till today to cash it, the check would be worth half of its original value. FACT! Economic forecasters, kind of like sportscasters who attempt to predict game winners (for all those simple minded sports folks out there), say that if the trend continues the check will lose 90% of it remaining value!!!!!!! Total depression in 2 and a half years!

    5,000 Dollars for an OUNCE OF GOLD!!!

    http://www.bloomberg.com/apps/news?pid=20602013&sid...


    DO YOU WANT TO CONTINUE TO BELIEVE IN A LIE THAT AMERICA IS NOT IN DANGER OF A DEPRESSION????
    unstephenk
    2 responses to this
  • Don't even get me started on the housing/credit bubble
    unstephenk
    4 responses to this
  • Can anyone say bank run
    cwc_agent
  • cwc, can you say freemarket,

    But i guess socalishit's would not understand.

    Lemme see here.

    govt. bails out chysler = govt. bails out poverty, drugs, katrina sponges, (still has not happened)


    It's called a free market - this stuff happens

    God bless america
    God bless big oil
    mrburns
    3 responses to this
  • Whatever it's only getting much much worse from here on out, so you can face it now or cry about it later.
    Kati_kat
  • http://current.com/items/88935543_greater_depression_10...
    Financial guru Peter Schiff's economic forecast delivered at U.S. Senate candidate Dr. Murray Sabrin fundraiser on 4/28. Excellent speech for anyone who is curious about what is happening to our economy right now.

    Mr. Schiff is the President of Europacific Capital and the author of "Crashproof: How To Profit From The Coming Economic Collapse." He is a regular guest on CNBC and FBN and has appeared on CNN, BloombergTV and Headline News.

    Topics covered:
    -- Federal Reserve's role in creating America'a "bubble economy"
    -- U.S. borrowing beyond it's means from other countries
    -- Devaluation of the U.S. dollar
    -- U.S. exporting of inflation to the rest of the world
    -- U.S. inflation creating rise in prices of commodities worldwide
    -- Artificial demand being created by the Federal Reserve
    -- Misplacement of blame on the free market instead of government failure
    -- Real causes of economic growth and why recessions are necessary
    Hawkmang
  • if everyone just pulls their money out, we will have another great depression...o the self-fulfilling prophecy
    achromatic
  • I wonder how many other banks would have to turn customers away if they started making mass withdrawls?
    covert1
  • Fannie Mae, Freddie Mac, IndyMac, Jimmy Mac, Mac the Knife, Macaroni, Ellie Mae, Mae West, etc. etc. etc... toast. What?
    swami
  • and so it begins im staying liqiud
    ana_may

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