Today federal regulators seized BankUnited in Florida. BankUnited was a thrift that was apparently critically undercapitalized. Its failure will cost the Federal Deposit Insurance fund an estimated $4.9 billion.
BankUnited was regulated by the Office of Thrift Supervision. It can now be added to the list of institutions that fell apart under OTS regulation, including Washington Mutual, Downey Savings and Loan and Countrywide.
BankUnited is the second most expensive failure of the crisis. The first? IndyMac, which cost more than $10 billion and was also, by the way, regulated by the Office of Thrift Supervision.