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Community Comment

Two more banks closed by FDIC…

Good morning, Netizens…

Doubtlessly mortified over the images that made their way around the world of the angry depositors demanding their money from a failed California bank, it would seem that perhaps the FDIC learned from their errors as they seized control of two more banks late Friday afternoon. In this picture, a bank employee posts a notice that 1st National Bank of Nevada is in FDIC receivership on Friday, July 25, 2008, after federal regulators closed the bank in Carson City, Nev. Twenty-eight branches of 1st National Bank of Nevada and First Heritage Bank, operating in Nevada, Arizona and California, were closed Friday by federal regulators. (AP Photo/Nevada Appeal, Brad Horn)

Both the FDIC and the news media were quick to note a so-called calm response to the closure, which was a stark contrast to the hundreds of angry customers who waited for hours earlier this month in Southern California to demand their money after IndyMac Bank’s assets were seized.

The 28 branches of the 1st National Bank of Nevada and First Heritage Bank N.A. — owned by Scottsdale, Ariz.-based First National Bank Holding Co. — were closed Friday by the FDIC. First National Bank of Nevada also operates as First National Bank of Arizona.

Mutual of Omaha Bank bought all the two banks’ deposits, even those over the amount protected by FDIC insurance limits. IndyMac customers had to take a loss on whatever amount they had in the bank over the insurance limits. On Monday, Mutual of Omaha will open the banks as its own branches, and during the weekend, accountholders can access their funds by writing checks or using ATM or debit cards.
One 1st National Bank of Arizona in downtown Phoenix didn’t even have a note outside to tell customers about the trouble Saturday. But there were no customers outside to tell because the banks were closed by that time, normally.

And those big lines of angry customers? What the FDIC and the news media didn’t mention is that the banks are normally closed on Saturdays, anyway. It is obvious that the FDIC has learned the essential skill of good timing.

Dave


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