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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: CalculatedRisk who wrote (90838)	9/28/2007 5:10:33 PM
From: BWAC	Respond to of 306849

See, its all contained. Rally on!

To: CalculatedRisk who wrote (90838)	9/28/2007 5:14:11 PM
From: Elroy Jetson	Read Replies (5) \| Respond to of 306849

Depositors with more than $100k at NetBank. Due to the projected sale of assets of the former bank, the FDIC is in the position to provide each uninsured depositor with an dividend equal to 50% of your uninsured amount. These funds will be deposited directly into your account net of your uninsured portion. .

To: CalculatedRisk who wrote (90838)	9/28/2007 5:21:11 PM
From: Smiling Bob	Read Replies (1) \| Respond to of 306849

Not a complete surprise But maybe enough to stir up some embers next week e pluribus unum 64.233.169.104 --- History NetBank was founded in 1996 as one of the nation's first Internet-only banks. Using a new business model, NetBank paid higher interest rates for computer-savvy customers in exchange for not having physical bank branches. This model made sense and the bank early on paid very nice interest rates. NetBank, like all banks, made its money from a mortgage and lending operation. The majority of home loans were offered through traditional channels and a small percentage of loans were offered through the same internet channels as the banking offerings. NetBank obtained customers by offering some sort of "sign on" bonus. A $50 bonus was a common bonus. NetBank signed many agreements with other companies to promote itself and the companies would offer gift certificate or credit to their loyalty programs (i.e., frequent flyer programs) equivalent to around $50. These customer acquisition programs proved beneficial and NetBank gained many customers through this manner. Starting in the early 2000's, NetBank acquired a number of financial-related companies to diversify and improve the bottom line. In 2000, Netbank added the following products and services: Online safe deposit boxes for safe storage of electronic records, individual retirement accounts, and expanded customer support (online chat and 24x7 availability). In 2001, Netbank acquired Resource Bancshares Mortgage Group, a leading provider of mortgage banking services. An online currency program was launched. And, NetBank acquired Market Street Mortgage, a leading provider of home mortgage to American consumers. The same year also brought a change in management to NetBank. A new CEO, Douglas K Freeman, was appointed to head and manage the company. Mr. Freeman came from RPMG and had a background in mortgages rather than banking. Many people blame the demise of NetBank on Douglas K Freeman as the company's focus shifted from being the premier online bank to earning profit through selling mortgages and mortgage servicing. In 2003, Netbank added a number of business and product lines: NetBank expanded into automobiles by offering auto insurance through sister company NetInsurance and direct consumer auto loans through Flordia auto dealerships. NetBank also acquired Financial Technologies, Inc, a provider of off-premise ATM and merchant processing services. A number of ATM machines were acquired in this acquisition. Finally, NetBank also launched a small business banking program. In 2004, Netbank continued adding new product lines and acquired additional companies. NetBank acquired the assests of Beacon Credit Services, a leading provider of RV, boat and aircraft financing. They added business credit cards, internet payroll services, prepaid Visa gift cards, and expanded financial planning services. In response to customer concerns about mailing in deposits, NetBank launched the QuickPost system where deposits are shipped overnight to NetBank for processing. NetBank reached the peak of the operation at the end of 2004 and through 2005. The rapid expansion into multiple lines of businesses may have proved to be too much, too soon for NetBank and it started to lose money in 2005. In 2005, NetBank suffered some setbacks due to the cyclical nature of the mortgage industry and did not add any businesses or products to their line, instead choosing to preserve capital until the mortgage curve righted itself and they could resume earning profit from the mortgage businesses. NetBank also introduced a tiered deposit system, where NetBank paid the highest interest rates to people who also were customers of NetBank's other products (home or auto loan, savings account, or CD) and the lowest interest rate to people that only had a savings or checking account. The intent was to better cross-sell the products and help transition the banking customers to the other platforms. Many customers were turned off by the tiered system because NetBank's auto loan rates were higher than other banks and many people didn't choose to have Autoloans through Netbank. In 2006, NetBank recognized that there were some signficant operating deficiencies and started to restructure the company in an effort to resume profitability. They shuttered a number of businesses and sold off most businesses that were not shuttered. Some of the shuttered companies included QuickPost, payroll and finance services, non-auto (RV, boat, and aircraft) loans, and the subprime/non-conforming mortgage companies. The large network of ATM machines were sold off to other companies. The indpendent auditor, Earnst and Young, resigned in 2006. In 2007, NetBank finally recognized the he restructuring attempt was unsuccessful, and the company announced an intention to shutdown the company starting in spring of 2007. NetBank initially reached an agreement to sell its core banking operation to EverBank in May 2007, but the deal ran into some difficulties and has not yet closed. Netbank has lost a considerable sum of money over the last few years due to the unprofitable operation of the mortgage lending business and the Office of Thrift Supervision now considers NetBank to be "under capitalized." This statement means that NetBank is likely to not be able to make good on its customers deposits held at the institution. NetBank was ordered to file a document with the Office of Thrift Supervision no later than September 13th, 2007 detailing how it will become well captialized again. It had not been published whether or not NetBank filed this document as required.