WASHINGTON (WVLT) -- The Tennessee Department of Financial Institutions seized BankEast at close of business on Friday and appointed the FDIC as receiver.

To protect depositors, the FDIC has negotiated a purchase and assumption agreement with U.S. Bank National Association to assume all of BankEast's deposits. As a result, all ten BankEast branches will reopen on Monday as U.S. Bank branches and BankEast customers will become U.S. Bank customers, according to the TDFI.

In a statement released immediately following the closure, TDFI cautioned former BankEast customers to continue using their current branch until receiving notification from U.S. Bank while the Cincinnati-based corporation completes the systems changes required to let them use other branches.

Over the weekend, former BankEast depositors can still write checks and use their ATM or debit cards. Checks drawn on the bank will continue to be processed as well.

Loan customers will need to continue making their payments.

According to TDFI, as of September 30, 2011, BankEast had approximately $272.6 million in total assets and $268.8 in total deposits.

Customers with questions about the transaction are asked to call the FDIC toll-free at 1-800-517-1839.
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The state shut down a troubled East Tennessee bank Friday night - citing BankEast's inability to continue normal operations.

The Knoxville-based bank had ten branches.
All of them are being taken over by U.S Bank National Association based in Cincinnati.

The banks were all open for business as usual, locking the doors at five for closing time on Friday.

But right at 6:01, business was anything but usual as the government shut down the bank.
Now the big question - what happens to your money?

Local 8 News was waiting by the door as a man in a dark suit walked outside and taped a sign next to the ATM ... a notice that the failed bank was being repossessed.

A note on the door shows the state determined the bank was operating in an unsound manner and capital is impaired.

Matt Fabian, a customer says,
"It wasn't a surprise because I heard about six months ago there was a possibility it would close, that the bank was in some trouble."

Matt Fabian is one of their many customers who was wondering what would happen now?

Well, the Federal Deposit Insurance Corporation - or FDIC - was named as the receiver.

It is part of the closing team that will hand the assets of BankEast over to U.S. Bank.

"They'll make business decisions as time goes on, but as of right now, everything is just the same as far as doing business."

And FDIC specialist Norma Tomlinson says "business as usual" also applies to the customers.

"Nothing has changed as far as access to banking, online banking, still works, the ATM works, the debit cards, it's just the same as it was yesterday except it has a new name."

Good news for Fabian, who used the ATM less than an hour after his bank shut down.

Fabian says,
"I've liked BankEast, so it's not a good feeling that it's going out of business."

A lot of changes will be coming soon ... but on Monday morning, all the branches will reopen, just under a different name.

The FDIC told Local 8 News there would be a team here for the rest of the weekend, assessing the assets and liabilities of the bank to make sure everything is accounted for.

The BankEast website is telling it's customers the Department of Financial Institutions shut it down.

And if you click on a link, you can still access your account.

The FDIC says the future of the current BankEast employees is up to U.S Bank when they assume control.