Washington  - US banking customers were left with many questions over the weekend after the assets of California-based US mortgage bank IndyMac were seized Friday by US federal regulators.

The Federal Deposit Insurance Corporation (FDIC) said late Friday evening in California that IndyMac's failure was the largest US bank crash since the fall of the Continental Illinois National Bank in 1984. Observors are asking what is to follow the latest drama of the US credit crisis.

The FDIC will run a successor institution, IndyMac Federal Bank FSB, starting next week, Bloomberg financial news reported Saturday. The regulator blamed US Senator Charles Schumer for creating a "liquidity crisis" after a letter on June 26, in which the Democrat from New York expressed concern that the bank may fail.

IndyMac specialized in so-called Alt-A mortgages, which didn't require borrowers to provide documentation on their incomes. The latest casualty of the subprime collapse may mean regulators will have to raise more money to support the federal deposit insurance program that repays customers when a bank fails.

"IndyMac is the vanguard, the precursor of more stuff coming," said Christopher Whalen, managing director of Institutional Risk Analytics, a market research company in Torrance, California. "It's not surprising to see IndyMac resolved. What you have to ask is what's coming next. It's going to be a wave of medium to bigger-than- medium institutions."

The lender had almost 900 million dollars in losses as home prices tumbled and foreclosures climbed. IndyMac's home state has been among the hardest hit by foreclosures. California had one foreclosure filing for every 192 households in June, 2.6 times the national average ranking second among US states. IndyMac becomes the largest OTS-regulated savings and loan to fail, according to the FDIC.

On Friday, major US stock indices dropped on continuing concern that mortgage giants Fannie Mae and Freddie Mac were threatened with possible collapse. US officials and politicians all sought to allay concerns Friday over the capital position of the two government- chartered companies.

IndyMac's failure was due to its failure to raise capital to continue operations in the continuing credit crisis in the US. And during the 11 business days after Schumer explained his concerns depositors withdrew more than 1.3 billion dollars from the 32 billion dollar bank, the Office of Thrift Supervision (OTS) said.

After peaking at 50.11 dollars on May 8, 2006, IndyMac shares lost 87 percent of their value in 2007 and another 95 percent this year. The stock fell 3 cents to 28 cents Friday.

"This institution failed due to a liquidity crisis," OTS Director John Reich said in the statement. "Although this institution was already in distress, I am troubled by any interference in the regulatory process."

Schumer blamed IndyMac's own actions and regulatory failures for the bank's seizure. "If OTS had done its job as regulator and not let IndyMac's poor and loose lending practices continue, we wouldn't be where we are today,'' Schumer told Bloomberg Friday. "Instead of pointing false fingers of blame, OTS should start doing its job to prevent future IndyMacs."

Mortgages serviced by IndyMac will be turned over to the FDIC and the regulator will be contacting customers immediately, Chairman Sheila Bair told Bloomberg Friday. Customers will have access to funds this weekend via automated teller machines and electronically and by telephone starting Monday.

The FDIC intends to sell IndyMac within 90 days, preferably as a single entity, Bair said. If that doesn't work, the lender will be sold off in pieces, she said.

The FDIC insures deposits up to a total of 100,000 dollars, and is calculating a liability with the IndyMac seizure of between 4 and 8 billion dollars. (dpa)