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More stories by this authorShares of NextCard came to a grinding halt Friday after banking officials said they are looking into the company's banking division NextBank.
Internet-only NextBank was also closed Friday by the Office of the Comptroller of the Currency after the board found the bank was "operating in an unsafe and unsound manner." The Federal Deposit Insurance Corporation (FDIC) was named receiver after it received no bids for the bank's deposits.
San Francisco-based NextCard was not available for comment, but had been looking for more than three months to sell NextBank.
Nasdaq Stock Market officials halted trading of NextCard stock at 8:13 a.m. Eastern Time for News Dissemination at a last sale price of 14 cents per share.
"Trading will remain halted until NextCard, has fully satisfied Nasdaq's request for additional information," Nasdaq released in a statement.
Phoneix-based NextBank, , had no brick-and-mortar branches. It solicited only certificates of deposit of $100,000 or more and had no checking or savings accounts. NextBank had total assets of $700 million and total deposits of $554 million, of which $29.4 million in 2,075 accounts exceeded the federal deposit insurance limit.
As a result, Monday morning the FDIC will mail checks to the customers of the failed bank for the amount of their insured deposits. Customers with more than $100,000 on deposit at the failed bank should contact the FDIC toll free at 1-877-367-2719 and ask to speak with a claims agent.
The FDIC is still in the process of evaluating the failed bank's assets. Until that process is complete, the FDIC will not be able to provide an estimated cost to the Bank Insurance Fund for the failure of NextBank.
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