On Friday, the Washington Department of Financial Institutions closed North County Bank, headquartered in Arlington, Washington, and appointed the FDIC as receiver. As receiver, the FDIC entered into a purchase and assumption agreement with Whidbey Island Bank, headquartered in Coupeville, Washington, to assume all of the deposits of the failed bank.

On Friday, the Florida Office of Financial Regulation closed Wakulla Bank, headquartered in Crawfordville, Florida, and appointed the FDIC as receiver. As receiver, the FDIC entered into a purchase and assumption agreement with Centennial Bank, headquartered in Conway, Arkansas, to assume all of the deposits of the failed bank.

On Friday, the Washington Department of Financial Institutions closed Shoreline Bank, headquartered in Shoreline, Washington, and appointed the FDIC as receiver. As receiver, the FDIC entered into a purchase and assumption agreement with GBC International Bank, headquartered in Los Angeles, California, to assume all of the deposits of the failed bank.

Yesterday, following announcements from Ally Financial and JP Morgan Chase of temporary suspensions of foreclosure efforts in certain states, Fannie Mae issued a statement yes

1. Do your best; work as hard as you can.

2. Fighting with the regulators is, at best, useless and, at worst, damaging to the institution. If the bank is going to fail, don’t blame the regulators.

3. Search hard for solutions. Short of buying out the bad loans with personal funds, be as aggressive as reasonably practicable. Prove to the regulators you know what is at stake: the insured deposits.

4. Cooperate with the bidders in any assisted transaction.

There are a number of ways directors and officers can get ready personally for potential FDIC litigation.

1. Take steps to understand the bank’s D&O insurance policies before the bank is closed. Determine whether policy coverage is offset by the fees for defense of claims. If so, understand the FDIC wants recovery, not protracted litigation.

The Board of Directors of the Federal Deposit Insurance Corporation, or FDIC, voted on Friday, October 8, 2010, to approve a proposed rule clarifying how the agency would treat certain creditor claims under the new orderly liquidation authority established under the Dodd-Frank Wall Street Reform and Consumer Protection Act.

T he recent surge in activity in the claims trading market in the wake of Lehman Brothers and other high-profile bankruptcies has created a backlog of open trades and heightened price volatility. This is a perilous combination. The lack of standardized trading documentation and uniform trading conventions, as well as the dramatic influx of new counterparties into the claims market, are factors that have contributed to longer settlement timeframes and increased uncertainty in the market.

When we last left off, Judge Peck (SDNY) was foiling Cyrus Select Opportunities’ efforts to oppose Ion Media’s chapter 11 plan, while in the Northern District of Texas, Judge Jernigan was putting the stops on Michigan Retirement Systems’ attempt to thwart Erickson Retirement Communities’ allocation of value to PNC Bank

On October 12, the FDIC issued a notice of proposed rulemaking for a rule clarifying how the FDIC would treat certain creditor claims under the new liquidation authority, established under the Dodd-Frank Act, for financial companies whose insolvency would pose a significant risk to the financial stability of the United States.