My fiancee was not amused……
WASHINGTON - An online bank with $2.5 billion in assets was shut down by the government on Friday because of an unsustainable level of mortgage defaults.
The federal Office of Thrift Supervision said it appointed the Federal Deposit Insurance Corp. as a receiver for Alpharetta, Ga.-based NetBank Inc. The FDIC said $1.5 billion in insured deposits will be assumed by ING Bank, part of Dutch financial giant ING Groep NV.
NetBank, which had no physical branches, “sustained significant losses in 2006 primarily due to early payment defaults on loans sold, weak underwriting, poor documentation, a lack of proper controls, and failed business strategies,” the OTS said in a statement.
Regulators shut online bank NetBank - Yahoo! News
20 responses so far ↓
GAPeach // Sep 28, 2007 at 6:30 pm
That makes two of us!
Netbank: Online Banking goes Offline. Permanently. | Zoli’s Blog // Sep 28, 2007 at 8:24 pm
[...] Update: Peach Pundit wins the Best Title Award: NetBank becomes NotBank. [...]
GabrielSterling // Sep 28, 2007 at 9:11 pm
So glad I got my deposit in at 12:40. Then I go online at 3:25 and see the FDIC tag up on the site saying “come back later”.
VictoratGaImproper // Sep 28, 2007 at 9:24 pm
Some of you are the FDIC and some of you now own NetBank, congrats:
http://www.fdic.gov/about/learn/symbol/index.html
1) “The FDIC insures bank deposits of up to $100,000″
2) “NetBank had $109 million in deposit accounts that exceeded the FDIC limit. Those customers will become creditors in NetBank’s receivership, the FDIC said.” - yahoo news…
3) “The FDIC receives no Congressional appropriations
StevePerkins // Sep 29, 2007 at 12:01 am
What a freaking day! A couple of weeks ago I ordered a new Toyota Prius (insert environmentalist/socialist joke here), and shifted $10,000 from my brokerage account to my NetBank checking account in preparation for the down payment. Just before getting off work and heading over to the dealership to pick up my car, I went online to double-check my account balance one more time. I saw a splash page saying that the goverment had shut down my bank. I nearly crapped a Toyota Prius in my pants! Of all the days for this announcement to come out… TODAY?!?
Supposedly I’m already a customer of ING now (the company that’s buying out NetBank’s assets), and the check I just wrote should clear the bank. However, my new-car joy is overshadowed by the apprehension that I’ll be looking over my shoulder for the repo man over the next several days!
I became a NetBank customer in the first place 5 or 6 years ago when they bought out CompuBank, my first Internet bank account that went belly-up. As much of a technology guy as I may be, I think on Monday morning I’ll be switching my paycheck direct deposits over to a credit union account and saying farewell to banking through the series of tubes they call the Internets.
VictoratGaImproper // Sep 29, 2007 at 1:14 am
Hmm, secondary to our Banking Committee, elected leaders whose watch this is happening under, you can hold these Corporate, white collar guys personally responsible. It’s interesting that there were no insider purchases since March of 2007:
Mr. Steven F. Herbert , 50
Chief Exec. Officer
Mr. Charles E. Mapson , 49
Chief Legal Exec., Chief Legal Counsel and Sec.
Mr. James P. Gross ,
Chief Financial Officer
Mr. R. Theodore Brauch , 48
Chief Risk Exec.
Mr. Joyce Bellows
Officer
NetBank Inc.
1015 Windward Ridge Parkway
Suite 100
Alpharetta, GA 30005
United States
Phone: 770-343-6006
http://www.netbank.com
sweet dreams, thank the good lord for your mattresses…
VictoratGaImproper // Sep 29, 2007 at 1:52 am
I think they call this “Trickle Overseas Economics” aka the “TOE” theory, you heard it here first at Peach Pundit…
Excerpts:
“US Dollar Beaten to a Pulp; Is Euro 1.50 Next?”
Friday September 28, 5:39 pm ET
By Kathy Lien, Chief Currency Strategist strategist@dailyfx.com
- Canadian Dollar Hits 31 Year High, Australian Dollar at 18 Year High
-Euro taking out 1.42
“Slower growth and rising inflationary pressures resurrect the risk of stagflation. The last time we had serious stagflation problems was in the early 1980s.” “For most companies, expansion is probably the last thing on their minds at the moment.”
Harry // Sep 29, 2007 at 12:36 pm
What, you’re waking up to all this NOW?
Meanwhile, the congress just increased the debt limit by one more trillion….keep on arranging the deck chairs.
Harry // Sep 29, 2007 at 12:38 pm
I’m thinking of offering my services to FDIC to go after the Netbank mortgage fraud…there’s a lot of it.
Harry // Sep 29, 2007 at 12:42 pm
Meanwhile, back to the important stuff: The real story behind Liz Taylor’s plan to marry husband No 9.
Why does this feel like the Roman Empire.
VictoratGaImproper // Sep 29, 2007 at 5:23 pm
Harry, i’ve been yelling about this since 2002 but that is neither here nor yonder as Macon, Georgia was able to assemble 2,000 people to blow on a kazoo and the weatherman from CBS came down to show the world how fat and happy everyone in poverty riddled middle georgia is. Kazoos don’t work when you blow on them, just like ethicsless governments you gotta just shutup, hum along and play dumb.
This feels like the Roman Empire because it is the Bush/Cheney/Carlyle/Haliburton/Saudi/Catholic/PseudoChristian/Neoconchickenhawk/dumbass/lemming/pseudoconservative/greedyrottenbastard Empire…
104,000 Netbank Customers are now owned by Netherlands ING for a paltry 14 million, 140 per head. Of course ING only took the customers that were covered by FDIC. Was there a competitive bidding process or did the FDIC overlords say, here, take this piece of the spoiled American pie, they are too stupid and corrupt to stand up to anything these days?
China could buy US on the open, free market right now and i still can’t read a damn bit of chinese…
adios, go shopping, kmart has a sale on velcros…
Harry // Sep 29, 2007 at 6:38 pm
But who do you suppose voted for the debt increase…Democrats or Republicans?
VictoratGaImproper // Sep 29, 2007 at 7:56 pm
You mean the debt increase to cover building palaces in Iraq, US Government Military Contracting Fraud, Victor Bouth’s arm’s stash and Getaway resorts in Germany?
Here is your future, it’s based on the past:
http://www.kunstler.com
Harry // Sep 29, 2007 at 9:19 pm
Do you know what is the national defense percentage of the total budget, and how it has trended over the years?
Anyway, those caring Dems just raised the federal debt ceiling another trillion (with a t) so the issue hopefully won’t have to be revisited again until after the election. However, as the dollar goes down maybe a trillion ain’t enough for the next 14 months. After all, they gotta raise enough to feed and provide housing and health care to all those voters!
joe // Sep 30, 2007 at 7:02 am
Harry // Sep 29, 2007 at 9:19 pm
Do you know what is the national defense percentage of the total budget, and how it has trended over the years?
This question actually needs to be answered. Too few people actually know.
GAO-07-226CG:
1965 43%
1985 27%
2005 20%
Gee, we must be spending a lot on the war.
VictoratGaImproper // Sep 30, 2007 at 8:18 am
like half a Trillion for occupationaloffensivedefense, this year alone…
VictoratGaImproper // Oct 1, 2007 at 5:30 am
Monday Oct 1, 2007
UBS becomes biggest victim of credit turmoil
By Peter Thal Larsen in London and David Wighton in New York
The bank said it had written down its fixed-income portfolio by SFr4bn ($3.4bn), mainly because of losses on US subprime mortgage-related securities, triggering a third-quarter loss of SFr600m-SFr800m.
http://us.ft.com/ftgateway/superpage.ft?news_id=fto100120070316206008
VictoratGaImproper // Oct 1, 2007 at 5:41 am
WASHINGTON (AP) — Bear Stearns Cos. Inc., the nation’s fifth-largest investment bank, paid Steptoe & Johnson LLP $100,000 in the first half of 2007 to lobby the federal government, according to a disclosure form.
The firm lobbied on Securities and Exchange Commission oversight of mutual funds and hedge funds and other securities legislation, according to the form posted online Sept. 18 by the Senate’s public records office.
New York-based Bear Stearns managed two failed hedge funds that were forced into bankruptcy this year after it made losing bets on securities backed by subprime loans, which are made to borrowers with risky credit.
http://biz.yahoo.com/ap/070927/bear_stearns_lobbying.html?.v=1
VictoratGaImproper // Oct 1, 2007 at 5:59 am
Brush up on your Chinese Boyz and learn a new meaning for the color Red.
So you think you are saluting the American Flag when you deposit money in a financial institution with an American Name?
9/28/07
http://www.thestreet.com
Bear Stearns has reportedly been courting a Chinese investment for some time. The Wall Street Journal reported in April 2006 that chief executive James Cayne met with China Construction Bank to sell the firm a $2 billion to $4 billion stake via a convertible bond offering.
The paper reported then that because the arrangement was a convertible bond, as opposed to a direct equity investment, the structure of the deal allowed the Chinese bank to avoid regulatory hurdles.
Indeed, convertible sales are convenient ways for investors to amass stakes in companies while avoiding shareholder votes and occasionally regulatory hurdles.
A “RedState” Owned Banking Institution?
Earlier this spring, China’s state-run investment unit agreed to take a $3 billion stake in Blackstone Group prior to its initial public offering.
The state-run investment fund will officially launch on Saturday, according to reports, and it will put $200 billion of the nation’s $1.3 trillion currency reserves to work in the global marketplace.
Libertarian Girl » Blog Archive » Please Tell Me What Checks to Write, FDIC // Dec 19, 2007 at 4:06 pm
[...] federal government shut down my bank, Netbank, a few months ago, and ING Direct subsequently bought out [...]