Summary: Netbank was closed on Friday by the federal government following losses on subprime mortgages, failures to improve underwriting, and exceeding the federal deposit insurance limit. Netbank declared bankruptcy and was promptly bought out by ING Direct (a much bigger online bank).
CEO Arkadi Kuhlmann said, "This is all about confidence in the market. Since we are the largest direct bank we were very pleased to assist and help out and hopefully take on these customers who will continue to do business on the Internet."
NOTE: Netbank deposits are protected by FDIC up to $100,000. Plus, they're officially ING Direct deposits now anyway. A notice on the site reads:
You will still be able to access your money the same way you have in the past, using your ATM card or Visa® check card, checks, online bill pay, wire transfers and standard deposits. Any automated features, such as bill payments or direct deposit, will continue as scheduled. Please Note: As of 5:00 PM EST Sunday, September 30, you will be able to resume all normal account activities via the NetBank website.