Who’s Behind the Financial Meltdown?

Published — May 6, 2009 Updated — May 19, 2014 at 12:19 pm ET

No. 14 of The Subprime 25: IndyMac Bancorp, Inc.


Total high-interest loans 2005-2007:

At least $26.4 billion

Federal bailout money received:


Company overview

  • Status: SEIZED and SOLD. After the FDIC’s 2008 seizure of IndyMac, it operated as IndyMac Federal Bank under FDIC supervision. OneWest Bank Group, a newly formed thrift, purchased IndyMac on March 19, 2009.
  • History: IndyMac was founded in 1985 by the founders of Countrywide as an offshoot (Countrywide Mortgage Investment) but spun off on its own in 1997. The bank was seized on July 11, 2008 by the federal Office of Thrift Supervision, which blamed its collapse in part on a letter from Senator Charles Schumer, D-New York, questioning its solvency. Depositors withdrew more than $1.3 billion following his comments. OTS Director John Reich told reporters that Schumer’s letter sparked a run on deposits that “pushed IndyMac over the edge.” Schumer blamed the OTS and said everything in his letter was already known to the public. The FDIC took over IndyMac, at a cost to the FDIC’s insurance fund estimated at $10.7 billion, according to a Treasury Department Inspector General report. At the time of the closing, the bank had customers with about $1 billion in uninsured deposits.
  • Parent/subsidiary companies: Originally affiliated with Countrywide (until 1997), IndyMac Bank was the principal subsidiary of IndyMac Bancorp, Inc.
  • CEO: CEO: Michael W. Perry
    • Most recent salary: 2007 – salary, $1,000,000; total compensation, $1,396,769
  • Location: Pasadena, California
  • Year founded: 1985
  • Backers: IndyMac issued billions of dollars-worth of subprime mortgage-backed securities underwritten by Wall Street investment banks such as Goldman Sachs. Firms such as Goldman and Lehman Brothers also issued their own securities composed in part of IndyMac loans.

Lobbying overview

  • Lobbying: 2007-2008: IndyMac did not report any lobbying, but lobbying firms working for the company have reported $40,000 in expenditures. **
  • Total Contributions: At least $88,220 *
  • Top Recipients:
    1. Mortgage Bankers Association PAC $38,225
    2. American Success PAC $10,000
    3. National Association of Real Estate Investment Trusts PAC $6,075
    4. Representative David Dreier, R-California $3,000
    5. Senator Chris Dodd, D-Connecticut $2,800

** Lobbying totals calculated by the Center for Public Integrity using data from the Senate Office of Public Records.

* Contribution grand total includes employee and soft money contributions from the lender and its subsidiaries. Top recipient totals include employee and political action committee contributions. Data provided by CQ Money Line, analysis by the Center for Public Integrity.

Read more in Inequality, Opportunity and Poverty

Share this article

Join the conversation

Show Comments

Notify of
Inline Feedbacks
View all comments