GOVERNMENT SEIZES WAMU, SELLS ASSETS TO JPMORGAN

This is THE LARGEST BANK FAILURE IN US HISTORY. Let that sink in.

From Bloomberg:

JPMorgan Chase & Co., the third- biggest U.S. bank by assets, agreed to acquire the deposits of Washington Mutual Inc. for $1.9 billion as the thrift was seized by regulators in the biggest bank failure in U.S. history.

The U.S. government closed Seattle-based Washington Mutual amid customer withdrawals of $16.7 billion since Sept. 15, the Office of Thrift Supervision said in a statement. WaMu had “insufficient liquidity” and was in an “unsound” condition, the OTS said.

Carney over at Clusterstock thinks this is a good thing, if you’re the FDIC:

…it should come as a relief to the FDIC. The company’s shareholders and senior debt holders are expected to be wiped out. (Including private-equity shop TPG, which recently plunked $7 billion in the company. This may be the worst return on any private-equity investment in history.)

 

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