Little change seen for WaMu customers, FDIC official says

Washington Mutual has been seized by federal regulators, and its assets have been bought by JP Morgan, the Federal Deposit Insurance Corp. announced this evening. So what does that mean for WaMu's Clark County customers, who at last count had deposits totaling about $972 million with the financial institution?

Debit cards, credit cards, check books and online accounts should all function normally, and account numbers will remain unchanged through this period of transition, said LaJuan Williams-Dickerson, spokeswoman for the FDIC, which backs these accounts with the full faith and credit of the U.S. government.

When the FDIC takes over a bank, it transfers the bank's assets to a healthy institution - in this case JP Morgan - so with time customers should expect to see a name change at the bank. But that will not affect the validity of checks with the old bank name, Williams-Dickerson said.

In the short run, customers can also expect long lines at local branches as concerned depositors show up with questions. "Panic sets in, and people want a story about what is going to happen," Williams-Dickerson said.

Which bank accounts are safe?
-- CASH DEPOSITS: Certificates of deposit, as well as savings, checking and trust accounts are insured for up to $100,000 per account holder, said Williams-Dickerson said.

-- RETIREMENT CASH: Cash deposits in individual retirement accounts at banks are FDIC insured for up to $250,000. The FDIC does not insure against retirement account losses in the stock market.

-- MONEY MARKET: Money market deposit accounts are insured for up to $100,000 by the FDIC. Money market mutual funds are not. After one of the world's largest money market mutual funds lost value, the U.S. Treasury Department announced last week that it will guarantee the U.S. mutual funds for the next year. After that, the guarantee is gone.

Many customers have more than $100,000 in insured deposits, but even so their money may be safe.

"Because it's $100,000 per account and per depositor, if a husband and wife have a joint account it's insured for $200,000. If the wife has a separate account, that's another $100,000," Williams-Dickerson said. "If they have four daughters and they set up a trust, that's another $400,000 insurance - $100,000 for each on that account."

Customers who have deposits that were not FDIC insured could lose money and you may have to wait to receive what cash they are due. In a savings account with $120,000, $100,000 is safe – but the additional $20,000 might be frozen for months.

Owners of uninsured deposits will get a "certificate of receivership." These entitle their holder to a share in the proceeds from the sale of the bank's assets.

Customers of IndyMac Bancorp, the Pasadena, Calif.-based bank that failed in July, could get as little as 50 cents back for every uninsured dollar in deposits, and might have to wait months to see that money. WaMu customers are likely to fare better, because their bank was not as overextended. But it could be months before they know the fate of uninsured deposits.