FDIC Approves The Assumption of The Insured Deposits of Netbank, Alpharetta, Georgia=20The Board of Directors of the Federal Deposit Insurance Corporation (FDIC) = today approved the assumption of the insured deposits of NetBank, Alpharetta= , Georgia, by ING Bank, fsb, Wilmington, Delaware.
NetBank, with $2.5 billion in total assets and $2.3 billion in total deposi= ts as of June 30, was closed today by the Office of Thrift Supervision, and = the FDIC was named receiver.
The failed bank was an Internet bank and did not have any physical branches= . Depositors of NetBank will automatically become depositors of ING Bank.
Over the weekend, customers can access their money by writing checks, or by= using their debit or ATM cards. Checks drawn on the bank that did not clear= before today will be honored up to the insured limit. Starting on the morni= ng of Monday, October 1, customers will have full access to their insured de= posits via the Internet and for the foreseeable future should continue to ut= ilize NetBank's current Website to transact banking business.=20
ING Bank has agreed to assume $1.5 billion of the failed bank's insured non= -brokered deposits for a one percent premium and will purchase $724 million = of assets. NetBank had approximately $109 million in 1,500 deposit accounts = that exceeded the federal deposit insurance limit. While these customers wil= l have access to their insured deposits, they will become creditors of the r= eceivership for the amount of their uninsured funds.=20
In addition to continued access to their insured deposits, depositors of NetBank with deposits in excess of the insurance limits will also receive an i= mmediate payment of 50 percent of their uninsured balance from the FDIC as r= eceiver.
NetBank also had approximately $744 million in brokered deposits that are n= ot part of today's transaction. The FDIC will pay the brokers directly for t= he amount of their insured funds.
"When a bank fails, it touches almost every office and division in the corp= oration," said FDIC Chairman Sheila C. Bair. "As chairman, it makes me proud= to see the hard work and dedication demonstrated by staff. Since we began i= nsuring banks in 1934, not a single depositor has lost a penny of insured de= posits. Customers of NetBank should have confidence and security knowing tha= t they will have access to their insured funds in a timely and orderly manne= r."=20
Customers with questions about how deposit insurance works or who would lik= e more information concerning the failure can visit NetBank's Website at NetBank.com; the FDIC's Web site at
FDIC; NetBank Failed; or call toll-free at 1-888-256-6932. While the toll-free number w= ill be operational 24 hours a day, seven days a week, customers are encourag= ed to call before midnight, Eastern Daylight Time, if possible.
It is important to note that neither the FDIC as receiver nor ING Bank as t= he acquiring institution will e-mail customers of NetBank asking them to val= idate their deposits or to request personal, confidential information, such = as account numbers, Social Security Number, driver's license number, etc. If= customers receive e-mails asking for such personal information, they should= consider them to be fraudulent in nature and should not respond.
The FDIC entered into a Loan Purchase Agreement with EverBank, Jacksonville= , Florida, to purchase certain assets of NetBank. EverBank will purchase abo= ut $700 million of mortgages held by NetBank. The FDIC will retain the remai= ning $1.1 billion in assets for later disposition, including NetBank's leasi= ng division, NetBank Business Finance which will continue operations. Loan c= ustomers should continue to make payments as usual.
The FDIC estimates the cost of this transaction to its Deposit Insurance Fu= nd to be approximately $110 million. NetBank is the second FDIC-insured bank= to fail this year and the first in Georgia since AmTrade International Bank= , Atlanta, Georgia, was closed on September 30, 2002.