Bank Emergency in Rhode Island
PROVIDENCE, R.I. — NEWLY inaugurated Gov. Bruce Sundlun (D) has ordered 45 Rhode Island loan-and-investment firms and credit unions closed indefinitely because of the collapse of their private insurer. The move jeopardized savings accounts of some of the approximately 300,000 depositors with $1.7 billion tied up in the financial institutions.
Governor Sundlun declared a bank emergency Tuesday afternoon -- just a few hours after he took the oath of office on the steps of the State House here.
He said the move was necessary to guard against runs on deposits. The institutions were left uninsured Monday when the Rhode Island Share and Deposit Indemnity Corporation put itself out of business by voting to enter conservatorship.
The newly elected Democrat said federal authorities would be coming to Rhode Island immediately to work with state officials around the clock to try to provide federal insurance to the institutions.