WaMu - Largest Bank Failure in U.S. History

[KenH]

JPMorgan buys WaMu

In the biggest bank failure in history, JPMorgan Chase will acquire massive branch network and troubled assets from Washington Mutual for $1.9 billion.

By David Ellis and Jeanne Sahadi, CNNMoney.com staff writers
Last Updated: September 25, 2008: 11:48 PM ET

NEW YORK (CNNMoney.com) -- JPMorgan Chase acquired the banking assets of Washington Mutual late Thursday after the troubled thrift was seized by federal regulators, marking the biggest bank failure in the nation's history and the latest stunning twist in the ongoing credit crisis.

Under the deal, JPMorgan Chase will acquire all the banking operations of WaMu, including $307 billion in assets and $188 billion in deposits.

In exchange, JPMorgan Chase will pay approximately $1.9 billion to the Federal Deposit Insurance Corporation. Separately, JPMorgan announced plans to raise $8 billion in additional capital through the sale of stock as part of the deal.

The acquisition is JPMorgan Chase's second major purchase this year following the mid-March acquisition of investment bank Bear Stearns, a deal that was also engineered by the government.


- rest at http://money.cnn.com/2008/09/25/news/companies/JPM_WaMu/?postversion=2008092523

 

[Bro. Curtis]

Just saw this on Rueters... and wow, eh ?


WASHINGTON (Reuters) - Talks on a $700 billion rescue for the U.S. financial system fell into chaos on Thursday amid accusations Republican presidential candidate John McCain scuppered the deal, and U.S. authorities closed Washington Mutual and sold its assets in America's biggest ever bank failure.
As negotiations over an unprecedented bailout plan to restore credit markets degenerated into chaos, the largest U.S. savings and loan bank was taken over by authorities and its deposits auctioned off. U.S. stock futures fell by more than 1 percent, the dollar weakened and share markets in Asia fell.
The third-largest U.S. bank JPMorgan Chase & Co said it bought the deposits of Washington Mutual Inc, which has seen its stock price virtually wiped out because of massive amounts of bad mortgages. The government said there would be no impact on WaMu's depositors and customers. JPMorgan said it would be business as usual on Friday morning.
Had a bailout deal been reached in Congress, it may have helped the savings and loan, founded in Seattle in 1889. Efforts to find a suitor to buy WaMu faltered in recent days over concerns about whether the government would reach a deal to buy its toxic mortgages.
Earlier on Thursday, U.S. lawmakers had appeared close to a final agreement on the bailout, lifting world stock markets and sending the dollar higher. But an emergency White House meeting between Congressional leaders with U.S. President George W. Bush "devolved into a contentious shouting match," according to a statement from the McCain campaign.....


http://www.reuters.com/article/topNews/idUSTRE48O7RX20080926?feedType=RSS&feedName=topNews

:applause:

 

[billwald]

>Under the deal, JPMorgan Chase will acquire all the banking operations of WaMu, including $307 billion in assets and $188 billion in deposits.

>In exchange, JPMorgan Chase will pay approximately $1.9 billion to the Federal Deposit Insurance Corporation.

Doesn't compute, does it? Pay $2 billion to get $307 billion is assets? Even if 90% of the paper assets are worthless - not likely - they are still paying only $2 billion to get $30 billion. Sounds like someone refused to pay the bribe or something. Someone is being punished by the government.