Netbank closed by fed, deopsits bought out by ING Direct

[mattlistener]

ING Direct Steps In as US Bank Collapses

Summary: Netbank was closed on Friday by the federal government following losses on subprime mortgages, failures to improve underwriting, and exceeding the federal deposit insurance limit. Netbank declared bankruptcy and was promptly bought out by ING Direct (a much bigger online bank).

CEO Arkadi Kuhlmann said, "This is all about confidence in the market. Since we are the largest direct bank we were very pleased to assist and help out and hopefully take on these customers who will continue to do business on the Internet."

NOTE: Netbank deposits are protected by FDIC up to $100,000. Plus, they're officially ING Direct deposits now anyway. A notice on the site reads:

You will still be able to access your money the same way you have in the past, using your ATM card or Visa® check card, checks, online bill pay, wire transfers and standard deposits. Any automated features, such as bill payments or direct deposit, will continue as scheduled. Please Note: As of 5:00 PM EST Sunday, September 30, you will be able to resume all normal account activities via the NetBank website.

Comments

[mamajoan.livejournal.com]

As I posted previously in my journal, ING was actually the second bank to attempt to acquire NetBank. Previously it had been announced that EverBank would take over NetBank, but that fell through and then ING stepped in. I'm still in wait-and-see mode before I decide whether to stay with ING or jump ship.

[violetcheetah.livejournal.com]

FWIW, I've been with ING Direct for 5 years with savings, and just opened a checking account with them when they offered the option. I've had no problems with them, and they haven't done the bait-and-switch with their high interest rates that other banks I've tried have done. To make deposits, you have to have a brick-and-mortar account at another bank to link to, but i have one with Wainwright for those few cash and check deposits I need to make.

[mattlistener.livejournal.com]

Thanks for the optomistic words -- after reading your comment I went and did a bunch of research and found that ING Direct is indeed a very reliable, customer-friendly and employee-friendly institution. So I'm actually psyched and transferring my money in advance of the offical NetBank digestion process.

It appears the only reasons to have a brick-and-mortar account are:
-Piggy-backing on the other bank's identification of you for security.
-Brick-and-mortar only services you may require (which are fewer and fewer these days).
-Depositing cash.

According to their website checks can be deposited by mail.

So, I'm just going to use my soon-to-expire Netbank account to fund the ING account, and open a Wainwright account if/when it appears I have a reason. (The nice ING CS rep said this was fine.)