Depositors of failed IndyMac Bank endured long waits in the summer heat for a second day Tuesday, with crowds becoming irate at several branches and customers with large accounts complaining of serious problems in getting their money.
Banking experts said the chaotic scenes risked touching off runs on other banks unless federal regulators quickly cashed out insured accounts and gave depositors accurate information about their funds.
The Federal Deposit Insurance Corp. took over Pasadena-based IndyMac late Friday and has assured depositors that accounts with $100,000 held in a single name or $250,000 in a retirement account are safe.
But many customers have said that when they checked their balances online, tens of thousands of dollars appeared to be missing. And when they went to branches in search of answers, they encountered lines hundreds of people deep and unhelpful staff members. On Tuesday, reports of unruly crowds brought police to branches in Encino and Northridge, although there were no arrests or injuries.
Noelle Gabay of Northridge, a budget analyst for the state of California, said FDIC officials acknowledged that she was owed $213,500 but provided her access only to $99,000.
"My trust in the FDIC is gone," said Gabay, 49. "The question is now, where do we put our money? Do we buy a bigger mattress?"
Bert Ely, a banking consultant in Arlington, Va., whose clients include financial-services trade groups, said the IndyMac situation was "generating anxieties all across the country."
"They should have been better prepared for this," he said, adding that regulatory oversight of IndyMac had been lax.
Ely noted that the bank, hobbled by massive defaults on loans made at the height of the real estate market, was not on the FDIC's list of troubled institutions as of March 31. It was placed on the list in June. However, he said IndyMac's fall was hastened by public questions from Sen. Charles E. Schumer (D-N.Y.) last month about the bank's strength -- comments that apparently helped trigger a $1.3-billion run on deposits.
Schumer has responded to such criticism by saying that IndyMac brought on its own problems by engaging for years in "poor and loose lending practices" that regulators should have prevented.
Longtime bank analyst Frederick Cannon, chief equity strategist for Keefe, Bruyette & Woods, said because of the distress at IndyMac, executives at other banks "are working very actively with their depositors to explain how insurance works, and what's covered."
