News
LA run on IndyMac despite assurances
Bewildered and anxious investors queued up to withdraw savings from a branch of failed California-based bank IndyMac, ignoring assurances that their money would be safe.
Around 200 people waited outside IndyMac's branch in this prosperous Los Angeles suburb, and some had begun patiently lining up from 5:00 am (1200 GMT), sitting on fold-out chairs to be first in line when the doors opened. A burly private security guard stationed at the door greeted worried customers, many of whom were retirees scrambling to withdraw every last dollar and cent from their accounts. Bank staff only allowed eight people into the bank at once, and a uniformed police officer and another security guard were stationed inside the doorway.
Many of those waiting outside expressed a similar sense of shock at IndyMac's collapse, saying the news on Friday that the bank had been seized by federal regulators had caught them by surprise. "I just didn't ever expect to see anything like this happening in our country. This is the kind of thing that happened in the Depression," said Dottie La Rose, 50, who was queueing with her mother.
"We just want to see what our options are and how much we can withdraw," added La Rose, blaming IndyMac's closure on "bad management."
La Rose's mother meanwhile took aim at the comments from Democratic Senator Charles Schumer last month concerning the bank's health, which prompted a flood of withdrawals by panicked customers. "I think a lot of this is down to what Schumer said," Mary La Rose, 76, said, The regulatory Office of Thrift Supervision (OTS) announced on Friday it had placed the California-based bank, worth an estimated $32 billion (Dh117bn), under the control of the Federal Deposit Insurance Corporation (FDIC).
The lender, which re-opened on Monday as IndyMac Federal Bank, marked the largest bank failure in a year of mortgage and foreclosure crises.
Around 200 people waited outside IndyMac's branch in this prosperous Los Angeles suburb, and some had begun patiently lining up from 5:00 am (1200 GMT), sitting on fold-out chairs to be first in line when the doors opened. A burly private security guard stationed at the door greeted worried customers, many of whom were retirees scrambling to withdraw every last dollar and cent from their accounts. Bank staff only allowed eight people into the bank at once, and a uniformed police officer and another security guard were stationed inside the doorway.
Many of those waiting outside expressed a similar sense of shock at IndyMac's collapse, saying the news on Friday that the bank had been seized by federal regulators had caught them by surprise. "I just didn't ever expect to see anything like this happening in our country. This is the kind of thing that happened in the Depression," said Dottie La Rose, 50, who was queueing with her mother.
"We just want to see what our options are and how much we can withdraw," added La Rose, blaming IndyMac's closure on "bad management."
La Rose's mother meanwhile took aim at the comments from Democratic Senator Charles Schumer last month concerning the bank's health, which prompted a flood of withdrawals by panicked customers. "I think a lot of this is down to what Schumer said," Mary La Rose, 76, said, The regulatory Office of Thrift Supervision (OTS) announced on Friday it had placed the California-based bank, worth an estimated $32 billion (Dh117bn), under the control of the Federal Deposit Insurance Corporation (FDIC).
The lender, which re-opened on Monday as IndyMac Federal Bank, marked the largest bank failure in a year of mortgage and foreclosure crises.