Regulators shut down IndyMac

US banking regulators have seized IndyMac, the troubled California-based mortgage lender, which announced deep losses and job cuts last week.

The Office of Thrift Supervision closed IndyMac's doors on Friday, and transferred the bank's assets to a newly chartered vehicle overseen by the Federal Deposit Insurance Corporation (FDIC). The closure will cost the FDIC's Deposit Insurance Fund - worth $48.4 billion - between $4 billion and $8 billion, the regulator said on Friday. IndyMac had a total of $19.06 billion in deposits and $32.01 billion in assets on March 31, FDIC said.

 Four other US banks have already failed this year and been brought under FDIC supervision, but according to FDIC data IndyMac is the largest in asset terms. Since the FDIC's foundation in 1934 there has been only one larger bank failure: that of Continental Illinois in 1984, which had assets of $40 billion.

IndyMac warned on July 8 that it was no longer well-capitalised and was making continuing losses from the mortgage crisis.

See also:US mortgage lender closes doors after capital warning