If you think sub-prime mortgage defaults can’t effect you, think again. At first reading, I thought this was a bad joke:
The Office of Thrift Supervision closed down NetBank Inc. (NTBK) a thrift with $2.5 billion in assets, and appointed the Federal Deposit Insurance Corp. as receiver.
But it’s not a joke. The online bank I’ve been using for almost a decade is reduced to this:
On September 28, 2007, NetBank, Alpharetta, GA was closed by the Office of Thrift Supervision and the Federal Deposit Insurance Corporation (FDIC) was named Receiver. No advance notice is given to the public when a financial institution is closed.
The FDIC has assembled useful information regarding your relationship with this institution. Besides a checking account, you may have Certificates of Deposit, a business checking account, a Social Security direct deposit, and other relationships with the institution.
The NetBank web site will be closed from 3:00 pm to 8:00 pm EST, on September 28th and will reopen in a read only mode. Normal online services will be restored in the early evening Sunday, September 30th.
To read more about this event please select the link below:
Frankly, under the circumstances I find the “Connect with your money” slogan rather comical. I guess fixing it is the last thing on their mind.
NetBank isn’t wasn’t some shaky Web 2.0 outfit, it’s been (well, appeared to) a solid bank for 10 years. They pioneered the concept of “brickless”, internet-only bank long before online transactions became the norm. I switched to them because at the time they were the only bank offering decent integration with both Quicken and Microsoft Money.
Now as a final act, they offer a once-in-a-lifetime experience: I’ve never seen a bank failure up close, personally. I guess I will soon (?) find out just “FDIC insured” means. I can’t even think of further implications now, but they can’t be good. We’re heading into shaky times.
Update: Peach Pundit wins the Best Title Award: NetBank becomes NotBank.
Update (9/29): Not everyone reads Friday afternoon news releases, but many do their online banking on the weekend. Or at least they try – now the Netbank failure is being noticed:
- US savings and loan with $2.5 billion rescued after defaults
- NetBank Fails, Taken Over By FDIC and ING Direct
- WTF, NetBank!
- NetBank Folds on Subprime Trouble: Biggest Bank…
- The Collapse of An Online Bank
- Largest Bank Closure Since S&L Crisis
- The Venus Neptune Angle On The Failure Of My Bank
- No More NetBank
- Could they lose $900K?
- NetBank Joins The Deadpool
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