In 1997, Countrywide spun off Indy Mac as an independent company run by Mike Perry, who remained its CEO until the downfall of the bank in July 2008.
Indy Mac often made loans without verification of the borrower’s income or assets, and to borrowers with poor credit histories.
It was heavily involved in Alt-A mortgages and reverse mortgages which in part resulted in its dramatic rise and has been suggested as the cause for its demise as large number of these questionable loans failed during the US subprime mortgage crisis of 2007-2009.
The FDIC put the assets up for auction and the bulk of the business was sold to IMB Hold Co LLC who turned this into One West Bank.
The FDIC kept some of the assets and liabilities that it could not sell in a holding entity known as Indy Mac Federal Bank, which would be slowly wound down.
as a means of collateralizing Countrywide Financial loans too big to be sold to Freddie Mac and Fannie Mae.