The bank owned by truck stop retailer Flying J is in good financial shape.
Flying J filed for Chapter 11 bankruptcy in late December 2008. Its financial subsidiary, Transportation Alliance Bank, agreed to an order in a late December filing with the Federal Deposit Insurance Company protecting it from Flying J’s financial problems.
Land Line’s Web site published an article with inaccuracies this past week regarding the Transportation Alliance Bank, and its stipulated agreement with the FDIC. The Web site has since corrected the story.
The FDIC filing does not affect the bank’s normal operations, and the bank itself remains in good shape, bank officials told Land Line on Monday, Feb. 23.
“Transportation Alliance Bank appreciates this opportunity to respond to the information in this and an earlier report published by Land Line Magazine’s Web site,” the Feb. 23 statement reads. “The bank is a wholly owned subsidiary of Flying J but it is a separate corporation with its own assets and independent management. The bank remains well capitalized and profitable, and continues to provide a full array of banking services to its customers.
“When Flying J filed for Chapter 11 bankruptcy reorganization about two months ago, the bank agreed to issuance of orders by the FDIC and the Utah Department of Financial Institutions (both of which regulate the bank) to protect the bank from Flying J’s financial problems. The regulators issue prophylactic orders whenever a bank’s parent files for bankruptcy protection. The orders are only intended to protect the bank’s independence and isolate its assets from the parent and the parent’s creditors. The orders do not imply any problem in the bank itself. None of these events have impacted the bank’s normal operations.
“Contrary to an earlier report, Transportation Alliance Bank does not make loans to Flying J. It only serves truckers and the trucking industry. In addition, the FDIC has never considered or threatened to terminate the Bank’s deposit insurance as indicated in the earlier Land Line article.
“Federal deposit insurance would not be in jeopardy even if the bank were failing, which it emphatically is not. The bank’s accounts always have been and always will be federally insured, currently up to $250,000 per depositor. Transportation Alliance Bank’s capital exceeds the highest capital category (well capitalized) and it has been consistently profitable. The bank will continue to operate normally and serve its customers for the indefinite future.”