Skip to main content
U.S. flag
An official website of the United States government
Dot gov
The .gov means it’s official. 
Federal government websites often end in .gov or .mil. Before sharing sensitive information, make sure you’re on a federal government site.
Https
The site is secure. 
The https:// ensures that you are connecting to the official website and that any information you provide is encrypted and transmitted securely.
Bank Failures

Question and Answer Guide

Franklin Bank, SSB, Houston, TX

En Español

FDIC Call Center
Toll free number 1-800-591-2845

Hours of Operation - Central Time
Friday, November 7, 2008:  Until 9:00 p.m.
Saturday, November 8, 2008:  9:00 a.m. – 6:00 p.m.
Sunday, November 9, 2008:  Noon – 6:00 p.m.
Thereafter:  8:00 a.m. – 8:00 p.m.

Is My Account Fully Insured? (closedbanks.fdic.gov/aii/)

Electronic Deposit Insurance Estimator (edie.fdic.gov/)

The following answers are provided to the most commonly asked questions by customers of the failed bank. The total balance in your account(s) has been transferred to Prosperity Bank, El Campo, TX and will be available for transactions during regular business hours at the former Franklin Bank, SSB branches.

DEPOSIT QUESTIONS

  1. Over $250,000   What if I have more than $250,000 in my accounts at Franklin Bank, SSB?
  2. Account Hold   I have been advised there is a hold on my account.  What does that mean?
  3. ATM/Debit Card/Checks  Can I continue to write checks or use my ATM/Debit card?
  4. Automatic Payments/Online Billpay  Will my automatic payments through Billpay continue?
  5. Brokered Deposits/Deposit Broker  I am a deposit broker or I have brokered deposits.  What do I need to do?
  6. Checks not Honored  A merchant will not honor my check.  What can I do?
  7. Claim Account(s)  How do I claim my account(s)?
  8. Customer Impact  How does this failure affect me?
  9. Deposits Existing at Prosperity Bank  I already have other deposit accounts with the new bank.  When combined with balances at this bank, my deposits exceed $250,000.  Are all funds insured?
  10. Direct Deposits, Social Security  What will happen to my direct deposits?
  11. Early Withdrawal Penalty  Will I incur an early withdrawal penalty if I close my CD before maturity?
  12. Final Statement   How will I get my final account statement(s) from Franklin Bank, SSB?
  13. Interest  Will I continue to earn interest at the same rate?
  14. Interest Check/Cashier's Checks  Can I cash my interest check or cashier's check?
  15. Internet Connection   Will my Internet connection to Franklin Bank, SSB work?
  16. IRAs   What if I have an Individual Retirement Account (IRA)?  Will my savings still be insured?
  17. Lose Any Money?  Will I lose anything on my deposit account?
  18. Outstanding Checks  What will happen to the checks which have not cleared my account?
  19. Records/Account Histories  What if I need information regarding my account during the time Franklin Bank, SSB was in business?
  20. Tax Reporting - 1098/1099s  Who will send my 1098 and/or 1099 information after the end of the year?
  21. Uninsured  Will I collect my uninsured deposits?
  22. Wire Transfer   Can funds be wired to me?

LOAN QUESTIONS

  1. Automatic Payments  Will my automatic transaction payment still occur on its assigned date?
  2. Construction Loan Draws  Will construction draws continue?  Will my project be completed?
  3. Construction Loan Voucher Control  Will my subcontractors be paid as before?
  4. Escrows  Will you continue to pay my escrows?
  5. Fees  Are there any changes to fees or charges due to this event?
  6. Lender and Contact Names  Who is my lender and has my loan contact changed?
  7. Loan Sales  Will my loan be sold?
  8. Line of Credit Advances - Home Equity  Can I continue to perform advances on my personal line of credit?
  9. Loan in Process  I have a loan currently in process.  How is my loan impacted?
  10. Loan Sweeps  Will my loan sweep be discontinued?
  11. Overdraft Line of Credit  Will my overdraft line of credit continue to cover my overdrafts?
  12. Payments  How and where do I make my payments?  Can I still pay by phone or at the branch?
  13. Pre-payment Penalty  If I refinance with another lender, will my pre-payment penalty be waived?
  14. SBA Application in Process  What will happen to my SBA loan application in process?
  15. What Happens Now  What will happen to my loan?

GENERAL QUESTIONS

  1. All-Deposit Transfer versus Insured Deposit Transfer  Why do all deposits, insured and uninsured, pass is some transactions but not in others?
  2. FDIC Insurance  How can I find out more about Federal Deposit Insurance rules?
  3. Media  I represent a TV/Newspaper/Radio and would like some information.
  4. New Bank Insured  Is the new bank insured by the FDIC?
  5. Safe Deposit Boxes  How can I claim the contents of my safe deposit box?
  6. Shareholders  I am a shareholder in Franklin Bank, SSB.  What happens to my shares?
  7. Unpaid Bill  I did some work for Franklin Bank, SSB and have not yet been paid.  What should I do?
  8. What Happened?  What happened, why did the bank fail?

1.  What if I have more than $250,000 in my accounts at Franklin Bank, SSB?

All deposit accounts have been transferred in their entirety to Prosperity Bank, El Campo, TX. All former Franklin Bank, SSB offices will reopen for normal business hours on Saturday, November 8, as branches of Prosperity Bank.

As an All-Deposit Transfer transaction, the total of all deposit accounts, whether within FDIC insurance limits or not, have been assumed by Prosperity Bank and will be available for business as usual.


Back to top

2.  I have been advised there is a hold on my account.  What does that mean?

It is possible a depositor’s account was held due to delinquent loans where the depositor is the borrower or guarantor. Additionally, any account pledged as collateral for a loan will continue to be held. A letter will be sent informing you of any holds placed by the FDIC, along with instructions on how to proceed. If you have any questions regarding these holds, please call 1-800-373-7840.


Back to top

3.  Can I continue to write checks or use my ATM/Debit card?

You will be able to continue using your personal checks at this time, and your ATM/Debit card will continue to work. The ATM machine will be unavailable for a short period of time on Friday for processing; however, it will be operational shortly after that is accomplished and will be available as usual.


Back to top

4.  Will my automatic payments through Billpay continue?

Yes. Billpay will be available as usual.


Back to top

5.  I am a deposit broker or I have a brokered deposits.  What do I need to do?

Brokered deposits will be passed in their entirety to Prosperity Bank. Please contact Prosperity Bank with any questions.


Back to top

6.  A merchant will not honor my check.  What can I do?

You can provide a copy of this document or the press release (https://archive.fdic.gov/view/fdic/3367) since both documents state all deposits have been transferred to Prosperity Bank, and it is business as usual. Copies of this press release will be available at the former Franklin Bank, SSB branches. Depositors or merchants can also call the FDIC at 1-800-591-2845 or the former Franklin Bank, SSB branches.


Back to top

7.  How do I claim my account(s)?

Your account(s) has already been transferred to Prosperity Bank, and your account(s) will be handled as usual. Any withdrawal, renewal or additional deposits will "claim" your account. Please be advised that if there is no activity in your account in the next 18 months, that money will be turned over to your state as unclaimed property. Unclaimed property can be located by visiting www.missingmoney.com or contacting your state’s treasurer’s office or office of unclaimed property.


Back to top

8.  How does this failure affect me?

All deposits (both insured and uninsured) of Franklin Bank, SSB have been transferred to Prosperity Bank, and it will be business as usual. If you held an account at Franklin Bank, SSB, you now have an account at Prosperity Bank that is available to you at your former Franklin Bank, SSB branches during regular business hours.

If you had a loan with Franklin Bank, SSB, please continue to make your payments to the same address as you have in the past until you are instructed otherwise. Continue to make your checks payable to Franklin Bank, SSB.

The former Franklin Bank, SSB locations will reopen for normal business hours on Saturday, November 8. You will have continued access to your money through your ATM/debit card and by writing checks.

Can Franklin Bank, SSB customers use Prosperity Bank branches?

No, not at this time. During the transition of Franklin Bank, SSB records to Prosperity Bank systems, Franklin Bank, SSB customers should continue to conduct their banking business at former Franklin Bank, SSB branches. You will be notified when you can use Prosperity Bank branches.

Similarly, existing Prosperity Bank customers cannot use former Franklin Bank, SSB branches and should continue to conduct their business at Prosperity Bank branches.


Back to top

9.  I already have other deposit accounts with the new bank.  When combined with balances at this bank, my deposits exceed $250,000.  Are all funds insured?

The transferred accounts will be separately insured for at least six months after the merger. This grace period gives a depositor the opportunity to restructure his or her accounts, if necessary.

CDs from the assumed bank are separately insured until the earliest maturity date after the end of the six-month grace period. CDs that mature during the six-month period and are renewed for the same term and in the same dollar amount (either with or without accrued interest) continue to be separately insured until the first maturity date after the six-month period. If a CD matures during the six-month grace period and is renewed on any other basis, it would be separately insured only until the end of the six-month grace period.


Back to top

10.  What will happen to my direct deposits?

Direct Deposits will continue as normal, including Social Security checks. If you need to change anything in the future, please contact or visit your former Franklin Bank, SSB branch location to make those arrangements.


Back to top

11.  Will I incur an early withdrawal penalty if I close my CD before maturity?

No. You may withdraw funds from any transferred account without an early withdrawal penalty until you enter into a new deposit agreement with your new bank. Entering into a new deposit agreement can be done by either renewing your CD or making a deposit to, or a withdrawal from, your account.


Back to top

12.  How will I get my final account statement(s) from Franklin Bank, SSB?

You will receive your account statements at the same time you have received them in the past.


Back to top

13.  Will I continue to earn interest at the same rate?

Prosperity Bank will honor all contractual rates on retail accounts. Any questions about your account should be directed to the local branch where you conduct business.


Back to top

14.  Can I cash my interest check or cashier's check?

Interest checks and cashier's checks will continue to clear. Official checks (those issued by institutions – for example, cashiers' checks, certified checks, money orders) meet the definition of non-interest bearing transaction accounts. Under the Temporary Liquidity Guarantee Program, non-interest bearing transaction accounts are fully insured.


Back to top

15.  Will my Internet connection to Franklin Bank, SSB work?

The bank website will be available as usual for regular transactions.


Back to top

16.   What if I have an Individual Retirement Account (IRA)?  Will my savings still be insured?

Yes, all deposits, including IRAs have been transferred in their entirety to Prosperity Bank. IRA funds are insured separately from other types of accounts up to $250,000.

If you close your IRA before maturity, you have 60 days to roll this over into another retirement vehicle. You should consult IRS Publication 590 and/or your tax advisor concerning the possible tax consequences of such distribution. IRS Publication 590 may be obtained by contacting your local IRS office or via the Internet at www.irs.gov.


Back to top

17.  Will I lose anything on my deposit account?

No. All accounts have been transferred in their entirety to Prosperity Bank and will be available starting on Saturday, November 8.


Back to top

18.  What will happen to the checks which have not cleared my account?

Checks drawn on Franklin Bank, SSB that did not clear before Friday, November 7, 2008, will be honored up to your available balance.


Back to top

19.  What if I need information regarding my account during the time Franklin Bank, SSB was in business?

Record requests will be handled as usual and should be directed to the local branch where you conduct business.


Back to top

20.  Who will send my 1098 and/or 1099 information after the end of the year?

Prosperity Bank will be responsible for mailing your 1099 tax information. Your 1098 reporting will be done by the FDIC or the servicer of your loan. You will be notified of any changes in ownership or servicing of your loan.


Back to top

21.  Will I collect my uninsured deposits?

All deposits have been transferred in their entirety to Prosperity Bank; therefore, there are no uninsured deposits.


Back to top

22.  Can funds be wired to me?Wire transfer request will be handled as usual and should be directed to the local branch where you conduct business.


Back to top

23.  Will my automatic transaction payment still occur on its assigned date?

You should experience no disruption in this service. We encourage you to check your bank account the day after your scheduled draft to verify the transaction. If the transaction did not occur, please call 1-800-373-7840 and we will research your loan.


Back to top

24.  Will construction draws continue?  Will my project be completed?

Each loan is being reviewed independently and will be determined on a case-by-case basis. You should direct your questions to 1-800-373-7840.


Back to top

25.  Will my subcontractors be paid as before?

Each loan is being reviewed independently and will be determined on a case-by-case basis. You should direct your questions to 1-800-373-7840.


Back to top

26.  Will you continue to pay my escrows?

All services previously performed related to your loan will continue. Should you receive notification that any portion of your taxes or insurance was not paid, please call 1-800-373-7840 immediately.


Back to top

27.  Are there any changes to fees or charges due to this event?

No.  The current fee structure will remain the same.


Back to top

28.  Who is my lender and has my loan contact changed?

Your loan is currently owned by the FDIC and is being serviced by all of the same personnel with whom you have worked in the past. All prior contacts remain the same.


Back to top

29.  Will my loan be sold?

Your loan may be sold at a future undetermined date. If that occurs, you will be notified in advance through written correspondence. If you are concerned about whom your future lender or servicer will be, you have the right to independently refinance you loan with another lender.


Back to top

30.  Can I continue to perform advances on my personal line of credit?

All Home Equity Lines of Credit (HELOCs) have been suspended at this time and have been retained by the FDIC. You may contact your local branch relationship officer to discuss establishing a borrowing relationship.


Back to top

31.  I have a loan currently in process.  How is my loan impacted?

Please call 1-800-373-7840.


Back to top

32.  Will my loan sweep be discontinued?

This will be determined on a case-by-case basis. Please call 1-800-373-7840


Back to top

33.  Will my overdraft line of credit continue to cover my overdrafts?

These will be handled as usual, and any questions should be directed to the local branch where you conduct business.


Back to top

34.  How and where do I make my payments?  Can I still pay by phone or at the branch?

You should continue to make your payments as agreed. Make checks payable to Franklin Bank, SSB and utilize the same payment address information.

You may continue to make your payments at the branch or by phone via check or credit card.


Back to top

35.  If I refinance with another lender, will my pre-payment penalty be waived?

Those will be determined on a case-by-case basis.


Back to top

36.  What will happen to my SBA loan application in process?

The FDIC as Receiver for Franklin Bank, SSB will not be originating any new loans.

If your loan has been approved by the SBA, but is not yet funded, please contact your loan officer. He will direct you to the proper SBA contact to help you locate another approved lender.

If your loan is in process, but is not yet approved by the SBA, we will release your SBA package on file with us to you, and you will need to apply with another SBA-approved lender. Please contact your loan officer to make arrangements to retrieve your application from the bank.


Back to top

37.  What will happen to my loan?

Each loan is currently being reviewed independently to determine the best action for that individual loan. If you are concerned about whom your future lender or servicer may be, you have the right to independently refinance your loan with another lender.


Back to top

38.  Why do all deposits, insured and uninsured, pass is some transactions but not in others?

The FDIC is required by law to employ the least-cost resolution measure for each failed financial institution. The most frequent result is for the FDIC to transfer only the insured deposits in a merger transaction. The FDIC is only able to transfer all deposits if the uninsured amounts are covered by the premium. The FDIC has been able to transfer all deposits in about 25% of the failures over the past 15 years.


Back to top

39.  How can I find out more about Federal Deposit Insurance rules?

You may access our website, which contains deposit insurance information and an Electronic Deposit Insurance Estimator (EDIE):

Deposit Insurance (www.fdic.gov/resources/deposit-insurance/)
Are my deposits insured? (www.fdic.gov/deposit/deposits/index.html)
EDIE (edie.fdic.gov/)

You may also order Your Insured Deposits or any other FDIC publication:

FDIC Public Information Center
3501 North Fairfax Drive
Room E-1002
Arlington, VA 22226

703-562-2200 Phone
703-562-2296 Fax
publicinfo@fdic.gov


Back to top

40.  I represent a TV/Newspaper/Radio and would like some information.

Please contact the Office of Public Affairs:

David Barr
202-898-6992
dbarr@fdic.gov


Back to top

41.  Is the new bank insured by the FDIC?

Yes. Your deposit at Prosperity Bank is insured by the FDIC, and each depositor is insured to at least $250,000, as established by law.


Back to top

42.  How can I claim the contents of my safe deposit box?

Customers will be able to access and utilize their safe deposit boxes as usual. Any questions should be directed to the local branch where you conduct business.


Back to top

43.  I am a shareholder in Franklin Bank, SSB.  What happens to my shares?

Franklin Bank, SSB had no publicly owned stock. Equity shareholders were invested in the holding company, and not in the bank. Please contact the holding company with any questions you may have.


Back to top

44.  I did some work for Franklin Bank, SSB and have not yet been paid.  What should I do?

Please send your bills to the following address:

FDIC as Receiver for Franklin Bank, SSB
1601 Bryan Street
Dallas, TX 75201


Back to top

45.  What happened, why did the bank fail?

Franklin Bank, SSB, Houston, TX was closed Friday, November 7, 2008, by the Texas Department of Savings and Mortgage Lending. Subsequently, the Federal Deposit Insurance Corporation (FDIC) was appointed Receiver. According to regulatory policy, there is no advance notice given to the public. Please see the Texas Department of Savings and Mortgage Lending press release for more information.

The good news is that no one lost any deposits as a result of the closure of Franklin Bank, SSB. To protect depositors, the FDIC Board of Directors approved the assumption of ALL of Franklin Bank, SSB's deposits by Prosperity Bank, El Campo, TX.


Back to top

SCAMS: Be watchful for and resistant to any scams to obtain information from you by individuals or entities stating that they are acting on behalf of either the failed bank, new bank, or the FDIC. Should you be contacted by anyone requesting personal information from you related to this event, please contact the call center above and you will be directed to the appropriate person.

For more information: www.fdic.gov/resources/resolutions/bank-failures/failed-bank-list/franklinbank.html

Last Updated: August 16, 2012