IndyMac Denies That It's Close to Collapse

Los Angeles Times (07/01/08); Reckard, E. Scott; Chang, Andrea
IndyMac Bancorp has refuted allegations that it is on the brink of collapse, instead assuring depositors that it is working with regulators to improve its "soundness" and that nearly all of their deposits are insured by the Federal Deposit Insurance Corp. The worries were triggered by Sen. Charles Schumer, D-N.Y., chairman of the Joint Economic Committee, who warned in recent public letters to bank regulators that IndyMac "could face a failure if prescriptive measures are not taken quickly." IndyMac has since responded that Schumer had created the "wrong impression" about the savings and loan's risks. IndyMac had specialized in making and then selling jumbo mortgages, subprime loans and mortgages with little or no income verification but has since recast itself as a maker of loans that can be sold to Fannie Mae and Freddie Mac.