FierceFinanceFierceFinanceITFierceCompliance IT   FierceCIO

WaMu fails, government steps in

Tools
Tags
Washington Mutual
Toxic Company
Government Insurance
Goldman Sachs
FDIC
Bond Rating
Bank of America

Washington Mutual, even with Goldman Sachs working on its behalf, ran out of time Thursday. Things had deteriorated to the point that the FDIC had no choice but to step in. They seized the thrift in what amounts to the largest failure of a financial institution ever. They then sold much of the company to JPMorgan--buyer of last resort?-- for $1.9 billion. That will create the largest retail bank in the country, surpassing Bank of America, according to the Washington Post. The FDIC acted to protect WaMu's assets and not drain the government's insurance funds. WaMu, in the end, had degenerated into a toxic company that no one else would touch on its own. Depositors were getting antsy, and the bank's bond rating had plummeted. It couldn't fund normal operations. So who's next? The dominoes keep falling.

For more:
- here's a Washington Post article

Related Articles:
Who's next to crater? WaMu?
No bidders for Washington Mutual
Washington Mutual lays an egg

Comments

Post new comment

The content of this field is kept private and will not be shown publicly.

More information about formatting options

To combat spam, please enter the code in the image.