FDIC Failed Bank Report: Claim Insured Deposits at Failed Banks

Downey Savings and Loan Association - Newport Beach, CA

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November 7, 2008: The banking operations of Downey Savings and Loan Association, F.A. - Newport Beach, CA were sold to U.S, Bank in a transaction facilitated by the Office of Thrift Supervision (OTS) and the Federal Deposit Insurance Corporation (FDIC). 

As of September 30, 2008, Downey Savings had assets of $12.8 billion and total deposits of $9.7 billion.

All deposit accounts and all loans have been transferred to U.S. Bank, National Association, Minneapolis, MN. All 170 branches in California and five in Arizona reopened for normal business hours as branches of U.S. Bank. Transferred deposits will be separately insured from any accounts you may already have at U.S. Bank for six months after the sale of  Downey.

U.S. Bank also acquired the assets and most of the liabilities, including covered bonds and other secured debt, of Downey Savings and Loan. Claims by equity, subordinated and senior unsecured debt holders were not acquired.

U.S. Bancorp
800 Nicollet Mall
Minneapolis, MN 55402
http://www.usbank.com

The FDIC and U.S. Bank entered into a loss share transaction. U.S. Bank will assume the first $1.6 billion of losses on the asset pools of Downey and PFF (also acquired by U.S. Bank) covered under the loss share agreement, equal to the net asset position at close. The FDIC will then share in any further losses. Under the agreement, U.S. Bank will implement a loan modification program similar to the one the FDIC announced pursuant to the failure of IndyMac Bank.

The FDIC estimates that the cost to the Deposit Insurance Fund will be $1.4 billion

For additional information and assistance contact the FDIC at: 800-930-5169 or go to: http://www.fdic.gov/bank/individual/failed/downey.html

2008 FDIC Insured Failed Banks
 
 
 
 
Downey Savings and Loan Association, F.A.
3501 Jamboree Road
Newport Beach, CA 92658
http://www.downeysavings.com
 

Established on 10/16/1957 as
Downey Savings And Loan Association
 

Assets: $12.8 billion
Deposits: $9.7 billion
 
 
Cost to FDIC: $1.4 billion

 

 
 

Insured deposits: All deposit accounts have been transferred to U.S. Bank, National Association, and are available immediately.

Services: Automated Teller Machines (ATM) remain available at the time of closing, and you may continue to use the services to which you previously had access, such as, safe deposit boxes, night deposit boxes, wire services, etc. Customers are asked to continue to use their existing branch until U.S. Bank can fully integrate the deposit records of Downey Savings.

Checks: Checks will be processed as usual. All outstanding checks will be paid against your available balance as if no change had occurred. Your new bank will contact you soon regarding any changes in the terms of your account. If you have a problem with a merchant refusing to accept your check, contact your branch office.

Interest: U.S. Bank will be honoring all existing CD rates.

Withdrawals: Account owners may withdraw your funds from any transferred account without an early withdrawal penalty until a new deposit agreement is signed with Downey Savings, as long as the deposits are not pledged as collateral for loans.

Automatic Direct Deposits: Automatic direct deposits and/or automatic withdrawals will be transferred automatically to your new bank. Contact a representative of your assuming institution at your branch office.

Loans: If you had a loan with Downey Savings, you should continue to make your payments as usual. The terms of your loan will not change under the terms of the loan contract because they are contractually agreed to your promissory note with the failed institution. Checks should be made payable as usual and sent to the same address until further notice. If you have further questions regarding an existing loan, you may call 1-800-591-2912.

Creditor Claims: U.S. Bank acquired the assets and most of the liabilities of Downey Savings from the FDIC as Receiver for Downey Savings. Any claims by equity holders were not acquired. There was no publicly owned stock in Downey Savings. If you are an equity shareholder, your shares are in Downey Financial Corporation, Newport Beach, CA, the holding company for Downey Savings, and not the institution. Downey Financial Corporation and the interests of equity, debt holders or other creditors of Downey Financial Corporation are not included in the closure or receivership of the institution. They should contact:

Downey Financial Corporation
3501 Jamboree Rd
Newport Beach, CA 92660

All claims against Downey Savings & Loan, together with proof of the claims, must be submitted in writing to the Receiver at the following address:

FDIC as Receiver of Downey Savings
1601 Bryan Street
Dallas, TX 75201
Attention: Claims Agent


Consumer Alert

Unclaimed FDIC Insured Deposits

Note: There are time limits on claims of FDIC-insured bank accounts, CDs and safe deposit boxes ...

If an insured depositor fails to make a claim an insured or transferred deposit within 18 months after the FDIC initiates the payment of insured deposits, the transferee institution must refund the deposit to the FDIC, and all rights of the depositor against the transferee institution are barred.

The FDIC then remits the insured deposit to the custody of the unclaimed property administrator in the account owner's home state, unless that state declines to accept custody. Upon delivery, the FDIC is deemed to have made payment to the depositor, and all rights of the depositor against the FDIC are barred.

Most states allow claims in perpetuity, but there's a reversion clause. If a depositor does not claim the deposit delivered to the custody of the State within 10 years of the date of delivery, the deposit must then immediately be refunded to FDIC, and all rights of the depositor against the state are barred.

It's important to note that If a state declines to accept custody of the deposit - which they sometimes do - the depositor must claim the funds from the FDIC before the receivership is terminated, or all rights of the depositor with respect to the deposit are barred. Dividends for credits arising from uninsured portions of a deposit may, however, be claimed after the receivership is terminated if a dividend check was returned by the post office for a bad address.

Be aware that due to the number of mergers and acquisitions in the banking industry over the years, it is possible you or a deceased family member might well have an account at a failed bank and not know it. Additionally, unclaimed safe deposit boxes at closed branches may be drilled and the contents sold at auction just weeks after closing, so prompt action is advised.  For assistance go to: Unclaimed Account Search


History: Established on 12/7/1981 as Downey Savings And Loan Association
1990 Acquired Butterfield Savings and Loan Association FSA (with FDIC assistance)
1995 Changed name to Downey Savings And Loan Association, F.A.


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