NetBank Meltdown and Everbank Escapes

NetBank's stock is now worth $.08 as the company has lost big money on its loan portfolio. Everbank was supposed to buy them but the deal is off - lucky for Everbank.

There's a good article by Mr Wave Theory entitled After 10 Years, NetBank Finally Goes Bust.  It paints a grim picture for NetBank one of the early Internet pioneers.  It's stock which was as high as $80 in the bubble days is now down to $.08.  According to the article, quite a bit of NetBank's loan portfolio was invested in RV loans which are basically trailer parks.  That sounds worse that sub-prime.  The company took a $200 million write-off several months ago and its stock was at $3.59.  Apparantly, things haven't gotten any better.

Everbank entered into an agreement to acquire NetBank's loan porfolio.  The only key closing condition was that the deal had to meet with regulatory approval before a certain date.  Lucky for Everbank, regulatory approval didn't happen and deal is dead.

 

Sol Nasisi
Sol Nasisi: Sol Nasisi is the co-founder and a past president of BestCashCow, an online resource for comprehensive bank rate information. In this capacity, he closely followed rate trends for all savings-related and loan products and the impact of rate fluctuations on the economy. He specifically focused on how rates impact consumers' ability to borrow and save. He also has authored a wee

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Comments

  • shraz

    September 27, 2007

    I was close to opening an account with them, good thing I didn't

  • Sam Cass

    September 27, 2007

    You're money would have been FDIC insured so it wouldn't have been a problem unless you put in more than $100,000K. I just found an article with more detail on this and am posting it.

  • Jorge

    September 27, 2007

    I was a Netbank customer for 7 years (2000-2007) and in their defense, I never had any problems with them. I just decided to close my account because their rates were no longer competitive with all the high interest internet-only banks in the last few years. In hindsight, they should have stuck with their core internet banking business instead of losing their shirt on their bad mortgages.

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