by Calculated Risk on 6/05/2008 09:57:00 AM

From the WSJ: Backstage at a Bank Funeral (hat tip FFDIC).

This is a story (and slide show) about how the FDIC handles a bank failure:

It isn't easy for 75 federal officials and contractors to slip into a small town undetected and liquidate an 89-year-old bank without anyone knowing. But that's what just happened in this old railroad town, population 3,200. It's a scene that's likely to repeat itself across the country as banks struggle through a painful credit cycle, overwhelmed by troubled mortgages and soured construction loans.
...
In its role as receiver for failed banks, the FDIC acts as a SWAT team, playing equal parts secret agent, medical examiner, salesman and grief counselor. The first 48 hours are typically the most frantic, as the agency must turn a failed bank inside out and oversee its sale -- or its orderly burial.

This is a story that will probably be repeated frequently over the next couple of years.