$60 Million Is Withdrawn From Lincoln
Customers withdrew $60 million from Irvine based Lincoln Savings & Loan Assn. within 48 hours of its seizure Friday, apparently due to confusion over bankruptcy plans of its parent corporation, federal regulators said Sunday.
Some depositors closed certificate accounts before maturity and paid the early withdrawal penalty because of confusion about the status of the thrift, according to M. Danny Wall, chairman of the Federal Home Loan Bank Board.
Wall announced Sunday that Lincoln, with 29 branches, will reimburse any early withdrawal penalties to customers who elect to reinstate their certificate accounts withdrawn since Friday. Wall, who heads the agency which put Lincoln into a conservatorship, said the policy will continue “until further notice. Now that depositors can see Lincoln is continuing to operate as usual under strong new management, we are extending the opportunity for them to reinstate their accounts and have the early withdrawal penalty reversed.”
Federal regulators took control of Lincoln Friday after its parent company, American Continental Corp. of Phoenix, declared bankruptcy Thursday. Wall said the confusion stemmed from the bankruptcy filing, which did not include Lincoln. Lincoln has $4.4 billion in deposits and assets of $5.4 billion.
The Associated Press contributed to this story.