The second largest bank failure in the history of the U.S. means about 1 billion in lost deposits held by 10,000 customers as reported by CNN Money. Accordingly, the Indymac website has a new look. The LA Times has pictures of customers lining up outside the bank, looking inside and here’s a picture of employees loading up their car with brown cardboard boxes.
Just before their demise, Indymac was offering high rates for their Certificates of Deposit. The LA Times asks an interesting question: “Should a money-losing financial institution be permitted to pay well-above-market deposit rates under the protective umbrella of federal deposit insurance? For a six-month CD with a $5,000 minimum deposit, IndyMac’s website [on Wednesday, July 9th] was offering an annualized yield of 4.1% as an online “special.”
I wonder what will happen to the severance packages offered to the 3800 workers who lost their job this past Monday?
I wonder which banks (federal or state chartered) are offering high, high rates on deposits today?