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IndyMac Bancorp seeks court OK to liquidate

August 02, 2008|E. Scott Reckard | Times Staff Writer

The parent company of IndyMac Bank, the giant Pasadena-based mortgage lender taken over by the federal government last month, is seeking bankruptcy protection while it liquidates its remaining assets.

In a Chapter 7 petition filed Thursday in U.S. Bankruptcy Court in Los Angeles, IndyMac Bancorp listed assets of $50 million to $100 million and liabilities of $100 million to $500 million.

Regulators seized IndyMac Bank, the operating subsidiary, on July 11. The Federal Deposit Insurance Corp. reopened it the next day as IndyMac Federal Bank and has been trying to find a buyer for it.

FDIC and bank officials sought to reassure depositors and borrowers Friday, saying the bankruptcy filing would have no effect on the operations of the reconstituted bank because there is no tie between IndyMac Federal Bank and IndyMac Bancorp.

"Our customers will continue to receive the same value and personal service they have come to expect from IndyMac, which due to its FDIC backing is one of the safest banks in America and a great place for our customers to keep their funds," IndyMac Federal Bank Chief Executive John Bovenzi said.

IndyMac Bancorp's chairman and CEO, Michael W. Perry, is currently its only employee.

The U.S. Office of Thrift Supervision shut down IndyMac Bank after customers spooked by reports of the bank's shaky condition withdrew $1.3 billion. A specialist in home loans to borrowers who didn't document their incomes, the lender racked up huge losses when defaults rose and mortgage investors would no longer buy its loans.

With IndyMac Bancorp's debts far greater than its assets, it is unlikely that there will be any value left for its shareholders after the liquidation, said Jerry Comizio, a banking lawyer and former Office of Thrift Supervision staffer.

Still, some die-hard speculators were trading in IndyMac stock, which closed Friday at 7 cents a share in over-the-counter trading, down 6 cents.

The bankruptcy filing says IndyMac Bancorp has fewer than 50 creditors, including professional firms and other banks. The amounts of their claims aren't listed. The list of creditors may be incomplete because the FDIC has taken custody of all of the company's records, the filing says.

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scott.reckard@latimes.com

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