And it's not even FDIC Friday!
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Posted on 09/25/2008 7:05:39 PM PDT by Sam_Damon
JPMorgan Chase acquired the banking operations of Washington Mutual Bank in a transaction facilitated by the Federal Deposit Insurance Corporation. All depositors are fully protected and there will be no cost to the Deposit Insurance Fund.
"For all depositors and other customers of Washington Mutual Bank, this is simply a combination of two banks," said FDIC Chairman Sheila C. Bair. "For bank customers, it will be a seamless transition. There will be no interruption in services and bank customers should expect business as usual come Friday morning."
JPMorgan Chase acquired the assets, assumed the qualified financial contracts and made a payment of $1.9 billion. Claims by equity, subordinated and senior debt holders were not acquired.
"WaMu's balance sheet and the payment paid by JPMorgan Chase allowed a transaction in which neither the uninsured depositors nor the insurance fund absorbed any losses," Bair said.
Washington Mutual Bank also has a subsidiary, Washington Mutual FSB, Park City, Utah. They have combined assets of $307 billion and total deposits of $188 billion.
Thursday evening, Washington Mutual was closed by the Office of Thrift Supervision and the FDIC named receiver. WaMu customers with questions should call their normal banking representative, service center, 1-800-788-7000 or visit www.WaMU.com. The FDIC's consumer hotline is 1-877-ASK-FDIC (1-877-275-3342) or visit www.fdic.gov.
WaMu is now on the failed banks list.
Here’s hoping Chase doesn’t end up eating dirt for it. /customer
Hmmm, I have 2 mortgages (both in good shape) and checking account here with automatic deposits. I wonder what this means to me - if anything.
And it's not even FDIC Friday!
. . . . .
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“WaMu’s balance sheet and the payment paid by JPMorgan Chase allowed a transaction in which neither the uninsured depositors nor the insurance fund absorbed any losses,” Bair said.
Hope you’re doin’ okay!
I hope the FDIC insures my Wamu account. I whittled it down to $5.33 a few months ago.
What the New York Stock Exchange floor specialist in WM did today either is illegal or else it ought to be.
We too have money in WAMU but today closed out one savings account and moved it to a more local bank that does not deal in any subprime mortgage lending. We also opened new checking accounts and it will take a month for our direct deposits to be sent there as the payments for Oct are already out in the mails for the 1st. I am moving my money market and IRA CD tomorrow. I don’t really care who has ownership of WAMU, or “how safe” they say we are. Today we tried to call WAMU to ask some questions about our accounts and when we finally got through the person to whom we were talking was located in the Phillipines!
Phillipines! UGH!
I’m more worried about my checking account and the auto deposits than the mortgages since creditors will always keep track of what you owe. Guess I need to find the closest Wells Fargo or something...
“WaMu’s balance sheet and the payment paid by JPMorgan Chase allowed a transaction in which neither the uninsured depositors nor the insurance fund absorbed any losses,” Bair said.”
>>>>>>>>>>>>>>.....................
big surprise, WM was solvent not Bankrupt..this is criminal
taking equity from share holders and giving it to JPM. I would expect many law suits from big investors on this..
all done by S&P and moody (mr buffett’s private enforcer on the stree)..folks this is the most disgusting show of government power I have ever seen..ps I am not an owner of WM stock or debt.
Specialist cross less than 40% of NYSE stocks now.
And most bid and ask size is hidden.
This ain’t yo’ Daddy’s equity market.
jas3
>>> For most of the day, the bid size was significantly larger than the ask size, sometimes as much as 10 times larger
I am not going to say that there is not some degree of manipulation to the PPS at any given time. What I do want to point out though, is that when you are looking at the Bid/Ask board, what you see is the limit orders that have been placed. Those trades will not be executed unless someone decides to buy at the ask limit or sell at the bid limit. So... while the number of bid orders may be much higher than ask orders, the bids may very well be much more resolute about the price they’re looking for. So it is not so much supply and demand as the price the balance of the orders is willing to settle upon at any given time.
The price jumped at the outset of the news break because people did not fully read the release and assumed it was the buyout they were waiting for.
“If anybody is naive enough to believe that stock prices fluctuate based on supply and demand, I recommend the study of today’s time and sales data of the stock of Washington Mutual (WM). For most of the day, the bid size was significantly larger than the ask size, sometimes as much as 10 times larger, and yet the price continued its relentless decline, only bobbing up briefly before the close.”
WM had at least one very large natural seller today. Getting any bounce out of it took hours, iirc.
Order size is almost meaningless in this context, because the seller uses reserve-display offers. He might only show 100 shares offered, but have a million at that price hidden.
Claiming the NYSE specialist was illegal is simply wrong. It is possible the natural seller(s) didn’t even use the floor (or maybe they did), but there is nothing illegal about having a very large seller sit on the stock.
A good example I watched more closely was what was probably Greenberg selling AIG today - they used mm FLOW and just killed the stock, and would NOT let it up until some guy on cnbc yakked about it. I wouldn’t be surprised if he sold far more than 10 million shares today.
For that matter, who is mm FLOW (listed)?
“The price collapsed in a period of minutes from $2.30 to below 40 cents! Truly astounding to watch.”
After-hours is thin anyway, but I am amazed they didn’t halt the stock. Presumably it will add a Q and trade pink sheets soon, joining LEHMQ?
Check out what they do with regard to subprime loans..our financial advisor yesterday told us to get out of WaMu. He said it could end up ok but who knows. We looked at the interest rates..they are not real great but do vary. Our direct depostis can be effetive in NOV and now that this bank has been bought out..maybe there is a little breathing room.
Frankly I have not like WaMu for some time..to impersonal. Our local banks are safer. My brother is a lawyer and deals with banking law and has said that if your accts are 100K or less they are FDIC secure. I asked him about a bank in TX that I have a money market acct with and he said it was safe and that they don’t deal with subprime loans...ask lots of questions and if you have a fincancial advisor ask advice there too.
WM had at least one very large natural seller today.
Who do you reckon that was?
Will someone remind again why we would want the corrupt federal government, who caused this whole mess, to be involved in any "bailout?"
don’t know anything about large wm insiders, i just trade the stock, so I am not sure who the possible suspects are. AIG is a bit different, Greenberg came out and said he was going to sell a lot, starting immediately.
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