This is what a 'bank run' looks like...

[capmac]

IndyMac borrowers line up in California to withdraw their cash

Mon Jul 14, 2008 12:57pm EDT

By Gina Keating

PASADENA, California (Reuters) - IndyMac Bancorp Inc customers lined up outside a branch at the company's headquarters on Monday, hoping to withdraw their money after regulators seized what was once one of the largest mortgage lenders in the United States.

Several hundred people arrived around 4 a.m., five hours before the Federal Deposit Insurance Corp planned to open that branch.

Regulators seized Pasadena-based IndyMac on Friday after a bank run in which customers withdrew $1.3 billion of deposits over 11 business days, as worries about the company's survival grew, regulators said. The bank has 33 branches in Southern California.

The FDIC said the renamed IndyMac Federal Bank will cover insured deposits, mostly up to $100,000, and initially cover 50 percent of uninsured deposits.

"I have $360,000 in this bank, and I was misled by this bank," said Robert Clark, a Glendale resident who was waiting on line. "I gave the names of my mother, my sister and my brother on the account so I thought I would be insured. I don't know what to do. I really don't know what to do."

http://www.reuters.com/article/topN...?feedType=RSS&feedName=topNews&rpc=22&sp=true

 

[jasonjm]

Quote from capmac:

IndyMac borrowers line up in California to withdraw their cash



"I have $360,000 in this bank, and I was misled by this bank," said Robert Clark, a Glendale resident who was waiting on line. "I gave the names of my mother, my sister and my brother on the account so I thought I would be insured. I don't know what to do. I really don't know what to do."

http://www.reuters.com/article/topN...?feedType=RSS&feedName=topNews&rpc=22&sp=true

FDIC insurance confuses me

is it 100 000 per different account name?

or 100 000 per account ?

would "robert clark" be covered?

 

[krazykarl]

that's a baby-bank-run. Here is the real deal:

 

[krazykarl]

Quote from jasonjm:

FDIC insurance confuses me

is it 100 000 per different account name?

or 100 000 per account ?

would "robert clark" be covered?

100k/ssn(tax id)/institution.

EDIT: read GTS's post on Page 2 for the correct answer.

 

[jasonjm]

Quote from krazykarl:

that's a baby-bank-run. Here is the real deal:

jeez

the police car is so colorful it looks like a pez dispenser

 

[nazzdack]

1) Is that a "bank run" or were they giving away free sandwiches that day? The people standing in line seem too well-behaved.

2) What's up with the paint on that parked car?

 

[krazykarl]

Quote from nazzdack:

1) Is that a "bank run" or were they giving away free sandwiches that day? The people standing in line seem too well-behaved.

2) What's up with the paint on that parked car?

2) Police car. (British...) Maybe it scares British criminals?

 

[Landis82]

Leave it to Bush #1 and Congress to have changed the FDIC's ability to intervene BEFORE a bank gets into "trouble" as they did countless times back in 1990 during the S&L crisis under Bill Seidman.

They absurdly passed a law in 1991 that no longer allowed the FDIC to get involved ( and match up poorly performing banks with healthy institutions ) until AFTER the entity had a run on it and closed its doors.

How freaking stupid can these elected leaders of ours be???

 

[krazykarl]

Quote from Landis82:

Leave it to Bush #1 and Congress to have changed the FDIC's ability to intervene BEFORE a bank gets into "trouble" as they did countless times back in 1990 during the S&L crisis under Bill Seidman.

They absurdly passed a law in 1991 that didn't allow the FDIC to get involved ( and match up poorly performing banks with healthy institutions ) until AFTER the entity had a run on it and closed its doors.

How freaking stupid can these elected leaders of ours be???

In all honesty, these banks need to fail. Yes it will be painful, but they made bad decisions and had poor risk-management.
Likewise the people that had >100k in these banks also need to learn the painful lesson. If people have substantial assets they should be smart enough to learn how protected they are.


IMO, this fiasco is all just Darwinism.

 

[GTS]

Quote from krazykarl:

100k/ssn(tax id)/institution.

Not true. A single individual can have multiple accounts at a single institution by using different POD titling on the different accounts

http://www.fdic.gov/deposit/deposits/insured/yid.pdf