Netbank Is Gone

Netbank, the first totally online bank, is gone. It was taken over by the FDIC last week as a failed bank. People whose deposits were under the limit had seamless access to their money as ING Direct took over the accounts. I’m one of the customers of Netbank and I was unaffected by the failure, at least on a financial standpoint.

I had transferred just about all of my money out of the account and had quit using the account at the end of July. At that point, they sent out a message to people saying if they didn’t increase their average daily balance to $500 that they risked having their account closed when the takeover by Everbank was completed.

The Everbank deal fell through and there was no other choice for the Feds than to take over Netbank. I think that letter in July pushed a teetering company over the edge. It can be seen now as a desperate calls for increased deposits and it makes me wonder if it is ethical for a failing bank to do send out that letter.