But when a buyer can’t be found, things can get more complicated for account holders.
The process of permanently closing a bank and its branches, selling off any assets and using the proceeds to settle as many of the bank’s remaining liabilities as possible.
“Essentially, the FDIC comes in on Friday afternoon after closing, relieves the existing management of authority and takes everything over, and usually by the following Monday morning they’ve reopened under the banner of the acquiring bank,” says Rebel Cole, professor of finance at De Paul University in Chicago.
But in rare cases — about 6% of bank failures since 2000 — the FDIC has been unable to find a buyer for the bank.
The FDIC is most likely to pursue this option if the bank is very small or if most of the deposits are from institutional investors or large businesses, Cole says. Let help you find the best local savings account today. 13, 2013, when The Community’s Bank of Bridgeport, Connecticut, was closed down by the FDIC.