National Mortgage News is reporting that the FDIC plans to start heavily marketing IndyMac Bank as a whole unit or in pieces starting in September. "We will widely market it, and we hope to generate a lot of interest," FDIC Chairman Sheila Bair said. This comes after the FDIC announced that it expects IndyMac’s failure in July to cost its insurance fund $8.9 billion, compared with the previous expected range of $4 billion to $8 billion.
While FDIC officials have said that they are capable of running the bank for years if necessary, it sounds like the unexpected hit to the insurance fund might encourage them sell off all or parts of IndyMac quickly. The question that no one seems to be able to answer is, who will buy the bank? Due to the sheer size of IndyMac, there aren’t a lot of companies that can afford to purchase the entire bank as a whole. As banks continue to struggle raising capital to offset write downs, purchasing all of IndyMac seems unlikely.
The FDIC has hired Lehman Brothers to help with the sale, which makes me think Financial Freedom could be the first part of the company sold. Lehman originally purchased Financial Freedom in 2001 and sold the company three years later to IndyMac for around $80 million in cash.
