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The Speaker is Charlie Scharf, Chief Executive Officer of Retail Financial Services, speaking at a JPMorgan Shareholders Meeting, about the WaMu Seizure.
Please Register your Shares: WMI files Counter Claims against JPM for Billions of dollars: What follows is a detailed timeline of the events surrounding the seizure of Washington Mutual Bank. We have a condensed version here: Calendar of Important Dates: WMI moves to investigate JP Morgan!! Phrases like 'far below market value', 'premeditated plan', 'designed to damage', 'purchase WMI vs FDIC Filed Document.
The havoc wreaked by some very powerful men: Latest Monthly Operating Report:: April Operating Report. From the book 'House Of Cards: A Tale Of Hubris And Wretched Excess On Wall Street' by Cohan, William D. A final decision had just been made by the US Treasury, i.
After Thain, Paulson and Geithner had left the New York Fed Sunday morning, the following exchange ensued, according to several sources that were there. John Mack, the CEO of Morgan Stanley, spoke up. Aghast, JPMorgan Chase's [Jamie] Dimon pointed out how shortsighted that was of Mack because Morgan Stanley might be the next firm that counterparties lost faith in. Dimon's comment quieted Mack. Mack denied he made the comment through a spokesman. A spokesman for Dimon said Dimon did not remember having the conversation with Mack.
Washington Mutual Bank, or WaMu, as it was known by its customers and employees, was seized on Thursday, September 25, The OTS intended to seize them on Friday, but the schedule was moved up one day when a media leak threatened to expose the seizure.
This is the story of what happened, and when, as well as some factors that affected the demise and sale of the bank. It should be noted that Washington Mutual Bank WMB was the largest thrift in the United States, and one of its largest banks. The seizure and sale were conducted in secret while Washington Mutual Bank was still well capitalized, liquid, while TARP was pending, and in fact at the same time WaMu was seeking bids to sell itself.
Washington Mutual Bank WMB was a subsidiary of Washington Mutual Inc. WMI Washington Mutual Inc had many other subsidiaries before the seizure and sale by the OTS and the FDIC. They had many less subsidiaries after that transaction-- some that may have not been associated with or subsidiaries of the bank WMB. They had multiple subsidiaries that were sold as well. The FDIC required only the administrative costs for the transactionand held the bank for only a few hours before ownership was transferred to JPMorgan.
Washington Mutual Bank was forced to file Chapter 11 the following day. The recent declines in the stock market are well known, but few people realize that WaMu may have been the straw that broke the camel's back.
This seizure impacted not just Washington Mutual Inc investors, but all types of investments in all US stock markets. Shock waves have cascaded throughout stock markets worldwide. This leads one to question whether Washington Mutual Bank should have been seized that September evening. The sale of WAMU, for a fraction of its worth, was conducted without regard for the bondholders or shareholders of the bank, much less for the effects to the confidence in our stock markets and our government in general.
Should WaMu have been seized, that fateful day? Did the regulatory bodies overseeing WaMu do their jobs properly? You be the judge. In April,JPM tried to buy Washington Mutual. They had long coveted the thrift for its many branches in markets where they had none and wanted to expand.
The price of expanding by themselves, without buying Washington Mutual, was cost-prohibitive. David Bonderman heads TPG, a company known for its talent in identifying and maximizing investment opportunities. Bonderman had been on the Washington Mutual Board of Directors previously and rejoined the board as part of their agreement. Things could get a lot more difficult for you,' said one of several current and former high-ranking WaMu executives familiar with details of the call.
Naked short selling of Washington Mutual continued to damage Washington Mutual severely and although it is illegal, the SEC did nothing to stop it. WaMu was not put on the list of banks that were not to be shorted. WaMu CEO Killinger specifically asked for WaMu to be added to the list but was refused. The Short ban notice announcement on 15 July by the SEC was to be effective the 21 st.
It is interesting to note the fax, which was received on the 17 th was logged in as received 8: The American Bankers Association, representing the interest of 8, banks, said in a letter to the SEC that it fears short sellers will now concentrate their efforts on banks that are not covered by the emergency order. They asked that the order be expanded to include stocks of all banks and bank holding companies.
This request was also ignored. Evidence of Damage Caused by Naked Short Selling: WAMU Stock Price vs. Failure to Deliver FTD of Securities http: September 29, American Banker magazine cites that the OTS did not want to seize the bank but the FDIC pressured them into it. It has been widely discussed that the FDIC was under funded to cover the amount of deposits they had to insure, and that the FDIC and OTS had differing opinions about whether WAMU should be seized.
The FDIC feared depletion of its reserves and they expected other bank failures. Congress had not increased its ability to raise premiums for many years, and indeed no bank premiums were collected from toas the FDIC was at its maximum threshold as required by law.
They have since increased their premiums. It is not clear why they did not use their discretionary power to support the one of the largest banks in the country, at least on a temporary basis. While all of this was happening the Economic Stabilization Act was being discussed in Congress.
While there was no question that TARP, as it has come to be known, would eventually pass, there were arguments over many details to be worked out.
The bailout would have alleviated the banks difficulties, at least in the short term, until a proper sale could be arranged, rather than a "fire sale" which ultimately gave the bank away for far less than fair value.
The fact that the bailout was pending meant banks were hesitant to bid due to the uncertainty; this has been well documented in multiple news articles. There is no record of any document wherein WaMu was required to raise additional capital, or improve its liquidity.
OTS Enforcement Actions noted on this report. WaMu said that it has entered into a memorandum of understanding with the Office of Thrift Supervision concerning aspects of its operations. WaMu committed to provide the OTS with an updated, multi-year business plan and forecast for its earnings, asset quality, and capital and business segment performance. The plan did not require the company to raise capital or increase liquidity, WaMu said.
This plan was approved by the OTS. The company expects both ratios to remain significantly above the levels for well-capitalized institutions at the end of the third quarter. OTS press release regarding TARP after they saw what mayhem the seizure of Washington Mutual caused. It is interesting to note that the West Coast Regional Director, Darrel Dochow, was transferred after it was discovered there were irregularities in bookkeeping methods, which were approved by Dochow, in the Indy Mac failure.
It has been also revealed that he permitted bookkeeping irregularities with 4 other banks in his region. The other banks have not been named. Dochow was demoted after that, but was later promoted again to West Coast Regional Director. He was transferred after the Indy Mac irregularities were made public and he later retired.
FDIC Actions that adversely affected the sale and auction of Washington Mutual. FDIC auction "offer" -- essentially says that easter trading westfield garden city bidders can have the bank for nothing as long as they pay the administrative costs of the transaction.
That part of the agreement was left blank. There is also a human cost; JPM has announced layoffs of WaMu employees with plans to cut an additional by attrition. It has recently been noted in the news that JPMorgan has made plans to outsource many jobs in their organization. All the following documents regarding the FDIC auction are posted at http: Date of fax —Sept 24, Each Potential Acquirer's bid s should be based upon the relevant transactions described in the Legal Documents and these Instructions.
Each should note that the transactions are merely summarized herein and the Legal Documents are much more detailed. The Legal Documents will govern the transaction regardless of the contents of these Instructions and any other written or oral material or communication.
JPMorgan bid for WAMU …NOTE: The details of the bid are redacted. Fidelity stock trader Mutual Bank Closing book Sept 25, The Assuming Bank will purchase all assets whether or not on the books of the Bank, except for those that are specifically excluded under Article III of the Whole Bank agreement.
In general, all assets are acquired at book value with the exception of securities which are purchased at fair market value.
The FDIC will not release any information on that bid. Another FOIA request confirmed the bidder as Citigroup, but their bid was deemed "nonconforming" and the information was so heavily redacted that it was nearly a black page.
Congress was debating the issues and it was expected to pass at any time. TARP passed 8 days after WAMU was seized. Four banks submitted their plans by the Wednesday due date, and the same day JPMorgan was notified it had won. The FDIC declined to name runescape money making guide f2p 2016 no skills other participating banks.
Though widely discussed in the press, the source of the leak has not been identified. It cites Schedule 3. It appears there is NO LIST of what was included in the purchase. The figures cited by the FDIC are noted to be "unaudited". Boxing day trading hours chadstone shopping centre forward to 3 hours 14 minutes to hear the following excerpt: Got the call from the FDIC on a Fridaythey came to meet with us on a Mondaythe deal was announced Thursday night I was out in ah Seattle, Frank came out to Seattle, J Dimon was out in Seattle, the place…you know it was ours the next day One must wonder whether the OTS and the FDIC knew about this.
JPM also tried to claim this money in court. The court determined the money belonged to the parent company, Washington Mutual Inc. It is unknown whether the other banks were also unofficially informed of the seizure, well in advance. Was the auction a fair playing field? Did all the bidders have the same information JPMorgan had? Escalpelamento forex Mutual was not aware of these backroom discussions between JPM and the FDIC.
In fact, Washington Mutual, through Goldman Sachs, was trying to sell the bank on the open market to those very same banks, but curiously their attempt drew no bidders. Why would a bank bid openly can you buy options in tfsa Washington Mutual when they knew the FDIC was fx forex uk login a deal, behind Washington Mutuals back for only the choicest assets instead of the entire bank?
Their behind the scenes discussions interfered bisnis forex halal atau haram the banks ability to sell itself.
Did JPM know three weeks prior to Sept 25 of a possible FDIC seizure?
Was the bidding process fair and impartial? That is an issue for a Congressional Hearing to decide. The entire matter is currently under a clandestine investigation. Many shareholders have contacted their Congressional Representatives requesting an open Congressional Hearing on this matter. In most cases they have received no response from Congress.
Sheila Bair said, shortly after the seizure of Washington Mutual, the seizure was stepped up due to a leak. She added that all deposits, both insured and uninsured are covered.
But here she says it was stepped up due to its deteriorating condition. When they came back online they noted that the previous story was inaccurate, and the bank run was at a different bank Indy Mac?
Mutual Funds Ate the Stock Market. Now ETFs Are Doing It. - Bloomberg
As we now know, there were plans to seize Washington Mutual before the 25 th. In fact, JPMorgan was notified Sept 19 th about the seizure, and indeed knew about the prospects for seizure three weeks in advance. No information has been released regarding the situation at the time the OTS began making plans to seize the institution. What effect did this have on the seizure of Washington Mutual? It has recently come to light that on the 18th of September there was a Billion dollar drawn down on money market funds during a 2 hour period, and maritz research work from home was panic among regulators.
This indicates that most, if internet earn money bangladesh all, banks were under significant pressure at that time.
There is much discussion about the veracity of this statement by Paul Kanjorski.
Washington Mutual, Inc. - Dictionary definition of Washington Mutual, Inc. | omenejomy.web.fc2.com: FREE online dictionary
There was a systemic country wide financial meltdown; why was WAMU seized? Washington Mutual was liquid and well capitalized. The seizure was unjustified, premature, and unwarranted. It was in the form of a forced sale, under the threat of seizure. The agreement reached would have required federal assistance to mitigate risk to Citigroup.
A legal battle ensued, the FDIC maintained that it stood behind Citigroup and the deal it had brokered, but Wells Fargo was the eventual victor due to their superior offer.
Perhaps the differentiating factor was the fact that the sale of Wachovia was done publicly, over a period of a week or more, rather than secretly over a period of hours, as the WAMU "deal" had been completed. Stock market charts show that the day following the seizure of WAMU, the markets took a nosedive. This is thought to be because investors felt they could no longer trust the government, since they had become erratic in their treatment of the banking crisis. The premature seizure destroyed the value of WaMu's bondholders and stockholders, at the same time destroying confidence in the market.
Why invest in any publicly traded company if the government can arbitrarily seize your interest, leaving you nothingor perhaps pennies on the dollar? There have been no news articles indicating that the other banks were notified at that time. 1980 stock market washington mutual composite fund the seizure, JPMorgan and the FDIC have challenged Washington Mutual Inc the Holding Company that owned WMB on myspace cash maker benefits of writing off its losses prior to the seizure.
That may be because they can't; there is no list in the Purchase and Assumption Agreement 3. The purchase agreement is incomplete. JPMorgan objected to having to show any claim by the claim filing deadline. Their objection was overruled by Judge Walrath, the judge presiding over the bankruptcy case. Weil and Gotshal have filed a claim against the FDIC December 30, The FDIC failed to get a reasonable price, even though they are required by law to maximize the return on the assets seized as well as to minimize the impact to the FDIC fund.
JPMorgan got the bank at a substantial discount, as they have documented well in their SEC filings. The FDIC also gave JPMorgan many subsidiaries. Some of those subsidiaries may not have been on the banks books, and in fact may have belonged to the parent holding company, Washington Mutual Inc WMI. SEC did not do its job; illegal short selling damaged WaMu. Washington Mutual is not included on the list.
SEC bans short selling of financial companies, including Washington Mutual. Did the FDIC do their job properly after the seizure of Washington Mutual? Sheila Bair, in a 60 Minutes episode which aired on March 8,said that the FDIC did not shutter big banks. Washington Mutual was a big bank and the fallout from its seizure was widely felt in the US markets and indeed around the world.
Stockholders were essentially wiped out in this seizure, due to the fact that the FDIC permitted the deal to be written with no regard to provisions for the stockholders. Many of these stockholders were Pension Funds, large institutions, as well as individuals K's, IRA's and other private accounts.
The question at this point is whether the FDIC acted appropriately in only getting 1. Many institutions were severely impacted by the sale agreement the FDIC arranged. The sale agreement had far reaching, adverse effects both on portfolios and the market in general. A WSJ article states that WaMu has hired Goldman Sachs to find a buyer of the bank.
WaMu's rating slips to a 4 and is placed on the FDIC's watch list, a fact kept secret at the time to prevent a self-fulfilling run on the bank. A 4 rating reflects financial, operational or managerial weaknesses that threaten a bank's financial viability. FDIC talks with JPM about WaMu. From JPM presentation onMonday: FDIC meets with JPM. From JPM presentationWednesday: FDIC Chairman Sheila Bair told reporters on Thursday that after an open process to find a buyer failed, the agency turned to its secretive auction process in which bidders place their offers on a secured website.
The auction turned out to be not so secret when a media leak prompted early seizure of the bank. The "leak" has not been identified. Which other organizations bid for WaMu, and the contents of those bids, have not been revealed by the FDIC. Here is an abbreviated timeline of what happened. OTS seizes WaMu and gives it to FDICFriday: JPM states that the WaMu transaction was 'very non-traditional'. Did the FDIC do a fair and impartial auction? Were all banks given the same information at the same time?
By some reports JPMorgan knew of the auction 3 weeks prior. Did other banks have that same advantage? JPM was notified on Friday, that they would get the bank.
That was days before the auction officially began. Although stockholders and bondholders are not technically the FDIC's responsibility, was it wise or fair to totally disregard the interests of these stakeholders? FDIC regulations as quoted from their official website: The seizure of assets which were not on WMB's books leaves open the real possibility that some of those assets actually belonged either solely to WMI or were owned jointly and as such were not rightfully seized.
It appears that that Schedule 3. This section is missing, despite being referenced repeatedly in the version of the document posted initially on the FDIC's website. It was rebuffed at the time for being too low; it was less than WMI common stock's market price at that time. Through the seizure and acquisitionJPM expanded its' banking footprint into states with little Chase coverage.
These include Washington, Oregon, California, and Florida. They were also given the ability to return any branches they didn't want to the FDIC.
JPM assumed both the WMB and Providian credit card subsidiaries along with all other subsidiaries of the bank. When asked about loan losses if the economy were to worsen, JPM stated that even under the pessimistic assumption if the loan losses exceeded expectations, the worst they would do would be to end up flat.
Due to the fact that the other WMB assets would still be making money.
The WMB acquisition would result in, a "stable, predictable earnings stream" due to retail customers. The fair value of the net assets acquired exceeded the purchase price which resulted in negative goodwill. In accordance with SFASnon-financial assets that are not held-for-sale were written down against that negative goodwill. Negative goodwill is a positive gain on a balance sheet due to gains that cannot otherwise be accounted for.
The negative goodwill that remained after writing down non-financial assets was recognized as an extraordinary gain. The negative goodwill that remained after writing down non-financial assets was recognized as an extraordinary gain in Without this extraordinary gain due to Washington Mutual, JPM would have reported a loss for the quarter. FDIC accounting report on receivership detailing assets transferred http: JPMorgans hedge fund was amazingly unscathed by the economic turmoil.
Good trading sense or is there more to it? So to sum it up, JPMorgan Chase acquired a massive branch and credit card network that augmented their footprint in areas where they were weak. And after that they are left with a profitable bank that will continue to generate billions of dollars of profits every year for the foreseeable future. Was this a fair auction? Did government regulators do their jobs properly?
Was Washington Mutual fairly compensated for its bank? JP Morgan responsible for destruction of financial system: Feds say WAMU WAS the cause of collapse: Battle Brewing over Fire Sale of WaMu Banking Assets: It's about 2 minutes long.
Wall Street looks for an end of Verizon, United labor pains - Aug. 21,
WaMu Equity Group Case Numbers: WaMu was RAPED on her Birthday, by the COLLUSION between JPMorgan, the FDIC, the OTS, the courts, the SEC and persons in government. Note that many documents linked to in this page have been removed to hide the truth. Note also the amount paid for WaMu: Guess they didn't pick the number out of a hat did they?
WMI Counter Claims What follows is a detailed timeline of the events surrounding the seizure of Washington Mutual Bank. April Operating Report From the book 'House Of Cards: Here is a small peek into the inner workings that brought WaMu down: The Wamu Story Washington Mutual Bank, or WaMu, as it was known by its customers and employees, was seized on Thursday, September 25, It has recently come to light that on the 18th of September there was a Billion dollar drawn down on money market funds during a 2 hour period, and there was panic among regulators Frontline--PBS.
Should Washington Mutual have been seized at all? Latest Developments and Links: NY Times Slams the OTS: