FDIC Bank Takeover Accounting

Discussion in 'Economics' started by The Kin, Aug 25, 2008.

  1. So the FDIC takes over Indymac and pays an advance dividend of 50% on deposits over 100k

    Why pay the advance dividend?

    Also Financial Statements show Indymac had $11 billion in long-term debt. I assume this debt was cancelled with the takeover. The bank should be in great shape with $11 billion in liabilities off the books but FDIC still records $8 billion loss.

    What am I missing here?

    Also, how does the FDIC decide which banks can buy the assets of failed banks. At what price and who determines the value?