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How to get the inside scoop when your local bank fails

The FDIC took over Integra Bank in Evansville, Ind., on July 29. This photo was taken on Aug. 13 by Eamon Queeney for the Evansville Courier & Press.

Reporter Susan Orr stood among the crowd assembled outside Integra Bank when 64 police officers arrived. Their job was to provide security for the FDIC officials who had come to shutter the bank.

That scene – which looked like part of a movie – became the lede of her Evansville Courier & Press story about the events leading up to the bank’s closure.

“Many of the details of the closure are kept very secret ahead of time, but I learned that after the fact the parties involved may well be willing to talk,” Susan wrote in an email. “Any reporter with good banking sources could do a similar story, I think, if a bank failure occurs in their area.” So far this year, 68 U.S. banks have failed.

Today’s Tip: Work on source development to give you access when you need it.

Susan says she’d already scheduled an interview with the acquiring bank, Old National, for the Monday after the closure. When she asked about the closure, the bank was eager to talk, she says. The PR department even went as far as setting up interviews with 11 employees.

She got some wonderful detail, including that “ambassadors” from the acquiring bank were sent out to buy cookies and lemonade for the failed bank’s employees, who would be at work the evening before the takeover.

Susan Orr, reporter, Evansville, Ind., Courier & Press

Susan Orr

She called the police department and learned about the secrecy surrounding the officers’ off-duty assignment.

She called the TV reporter who broke the story and got details about how he learned of the story. (She had written about him when his wife died, she says.)

She also used the call reports on the bank’s condition from the FDIC.

She called the top executive of Integra. Turns out, he had locked himself out of his local apartment, which he had rented it to avoid a four-hour commute to his family. His story became the kicker:

“It was a frustrating moment in a very sad day.

“His suit jacket, cellphone and other belongings were still inside his apartment — but he had his car keys in his pocket, and he had somewhere to be.

“He got in his car and drove home.”

For more tips, check out this CBS “60 Minutes” segment on what happens in a bank closure. And don’t forget to ask for the minutes of any failed banks’ board meetings from the FDIC.

If you’re wondering whether any local banks or thrifts might be in trouble, look them up on BankTracker, a site run by American University’s Investigative Reporting Workshop.

About the Author

Rosland Gammon is a former business journalist turned college instructor. Her newsroom experience includes reporting for The Philadelphia Inquirer, and reporting and editing at Bloomberg News. Gammon currently teaches communications at Alverno College in Milwaukee. Follow her daily posts. | E-mail: Rosland Gammon

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