FDIC's $905M Demand From Colonial Bancgroup Nixed

Law360, New York (September 01, 2010, 7:32 PM ET) -- A bankruptcy judge has rejected the Federal Deposit Insurance Corp.'s claim that it is owed $905 million from Colonial Bancgroup Inc., the bankrupt holding company that controlled the failed Colonial Bank.

Bancgroup made no promises that it would shore up Colonial Bank's capital reserves before it collapsed, Judge Dwight H. Williams of the U.S. Bankruptcy Court for the Middle District of Alabama ruled Tuesday.

The FDIC, as Colonial Bank's receiver, had argued that a memorandum of understanding between Bancgroup and the Federal Reserve made the holding...
To view the full article, take a free trial now.
Try Law360 for free for seven days
Already a subscriber? Click here to login

Already have access?

  1. Forgot your password?
  2. Sign In

Get instant access to the one-stop news source for business lawyers

Required