FDIC's $905M Demand From Colonial Bancgroup Nixed

By Richard Vanderford (September 1, 2010, 7:32 PM EDT) -- 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 company responsible for some of the bank's capital shortfalls.

Judge Williams found that the agreement...

Stay ahead of the curve

In the legal profession, information is the key to success. You have to know what’s happening with clients, competitors, practice areas, and industries. Law360 provides the intelligence you need to remain an expert and beat the competition.


  • Access to case data within articles (numbers, filings, courts, nature of suit, and more.)
  • Access to attached documents such as briefs, petitions, complaints, decisions, motions, etc.
  • Create custom alerts for specific article and case topics and so much more!

TRY LAW360 FREE FOR SEVEN DAYS

Hello! I'm Law360's automated support bot.

How can I help you today?

For example, you can type:
  • I forgot my password
  • I took a free trial but didn't get a verification email
  • How do I sign up for a newsletter?
Ask a question!