Netbank Closed, Depositors Now Under INGDirect
Posted by Best Bank Rates under [ CD Rates ] on September 30, 2007Netbank.com became the second internet only bank to close up shop a few days ago, as the FDIC took over Netbank’s assets and sold them to INGDirect. According to the FDIC:
Over the weekend, customers can access their money by writing checks, or by using their debit or ATM cards. Checks drawn on the bank that did not clear before today will be honored up to the insured limit. Starting on the morning of Monday, October 1, customers will have full access to their insured deposits via the Internet and for the foreseeable future should continue to utilize NetBank’s current Website to transact banking business.
Of course, Netbank was FDIC insured, so everyone with accounts less than $100,000 (or $250,000 for IRA CDs) should suffer only the inconvenience of the account transfers to INGDirect.
According to the FDIC page, internet access and online bill pay are currently not available, but should be up soon. In the mean time, customers can continue to use personal checks and ATM cards, and those with NetBank certificate of deposits may withdraw your funds from any transferred account without an early withdrawal penalty until you enter into a new deposit agreement with the ING Direct.
However, those who had deposited more than $100,000 may be able to get up to 50% or more on uninsured deposits:
NetBank had approximately $109 million in 1,500 deposit accounts that exceeded the federal deposit insurance limit. While these customers will have access to their insured deposits, they will become creditors of the receivership for the amount of their uninsured funds.
In addition to continued access to their insured deposits, depositors of NetBank with deposits in excess of the insurance limits will also receive an immediate payment of 50 percent of their uninsured balance from the FDIC as receiver.
The FDIC has set up a closing information page for Netbank as well as a pretty comprehensive Q&A page. With over $2.5 billion in assets, this is quite a major bank failure and it will be interesting to see how smoothly the system works. I’d like to hear any additional input or thoughts.
2.25% Money Market Bonus Rate at EverBank
APY Savings Account at Ally (6/23/2010)
1.21% APY with WTDirect Savings Account
5% Cashback Rewards with Chase Freedom 
2 Comments on “Netbank Closed, Depositors Now Under INGDirect”
Atlanta Journal Article: http://www.ajc.com/search/content/business/stories/2007/09/29/netbank0929b.html
CNN Article:
http://money.cnn.com/2007/09/29/smbusiness/cognetics.netbank.fsb/index.htm?section=money_topstories
Here’s an article I found on INGDirect:
ING DIRECT NEWS….
==============
ING DIRECT Acquires Deposits of NetBank
Nation’s Largest Direct Bank Acquires Deposits and Customers of the Nation’s Oldest Direct Bank September 28, 2007, Wilmington, DE –
ING DIRECT, the nation’s largest direct bank and fourth largest thrift (part of Netherlands-based ING Groep NYSE: ING), today announced it will acquire $1.4 billion in deposits and 104,000 new customers of Netbank for $14 million.
Headquartered in Alpharetta, GA and established in 1996, Netbank was the nation’s oldest Internet bank serving retail and business customers in all 50 states.
The acquisition further strengthens ING DIRECT’s position as the leading direct bank which aims to meet the financial needs of “Main Street, USA.†“ING DIRECT has a passionate focus on delivering a first-rate, technology-enhanced customer experience and we want to ensure the early adopters remain at the forefront of branch-free online banking,†stated Arkadi Kuhlmann, CEO of ING DIRECT. “The acquisition of Netbank’s customer relationships is part of ING DIRECT’s goal to broaden its reach and inspire Americans to become a nation of savers. We anticipate a seamless transition for Netbank’s customers into the ING DIRECT family,†added Arkadi.
Since its inception in 2000, more than 5.5 million Americans have entrusted their savings with ING DIRECT, building the bank to $57 billion in deposits, $23 billion in mortgage loans and $75 billion in assets.
The transaction was approved and closed today by the Federal Deposit Insurance Corporation (FDIC).