Washington Mutual

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Washington Mutual, Inc.

logo
legal form Corporation
founding September 25, 1889
Seat Seattle , United States
management Alan H. Fishman ( CEO )
Number of employees 49,403 (2007)
sales 26,523,000,000 US dollars (2007)
Branch Banks
Website www.wamu.com

Washington Mutual ( WaMu for short ) was one of the largest US financial companies in the banking sector. The company was listed in the S&P 500 . Washington Mutual was the sixth largest bank in the United States in the field of wealth management, valued at approximately $ 350.7 billion.

WaMu offered a variety of financial services to its clients, including mortgages , credit card services , investment finance and loans .

In autumn 2008 a banking and financial crisis escalated . On September 25, 2008, ten days after Lehman Brothers , WaMu collapsed. It was largely taken over by the financial group JP Morgan Chase in an emergency sale .

Company history

The Washington Mutual Tower in Seattle , Washington

Washington Mutual was founded as the Washington National Building Loan and Investment Association on September 25, 1889 after the major fire in Seattle. The name changed to Washington Savings and Loan Association on June 25, 1908 .

On July 25, 1930, Washington Mutual acquired Continental Mutual Savings Bank .

The company's marketing slogan became The Friend of the Family .

In 1983 the company acquired the financial firm Murphy Favre . Washington Mutual subsequently acquired mortgage providers such as PNC Mortgage , Fleet Mortgage and Homeside Lending and became the third largest mortgage provider in the United States.

In March 2006, the company moved to its new headquarters , the WaMu Center in Seattle. The company's former headquarters, the Washington Mutual Tower , was one block from the new headquarters.

After a series of bank mergers in the 1980s and 1990s, Washington Mutual was the only remaining major bank based in Seattle. Washington Mutual had started out as a simple savings bank, but with the real estate boom of recent years, its activities were geared towards the problematic mortgage market in the USA due to lower-class collateral ( subprime market ) .

As of mid-2008, the bank had 43,000 employees in over 2,200 branches in 15 US states.

List of acquisitions

  • Commercial Capital Bancorp, California, 2006
  • Providian Financial Corporation , California, 2005
  • HomeSide Lending, Inc., Florida , a unit of National Australia Bank , 2002
  • Dime Bancorp, Inc., New York , 2002
  • Fleet Mortgage Corp. , South Carolina , 2001
  • Bank United Corp., Texas , 2001
  • PNC Mortgage, Illinois , 2001
  • Alta Residential Mortgage Trust , California , 2000
  • Long Beach Financial Corp., California, 1999
  • Industrial Bank, California, 1998
  • HF Ahmanson & Co. (Home Savings of America), California, 1998
  • Great Western Bank , 1997
  • United Western Financial Group, Inc., Utah , 1997
  • Keystone Holdings, Inc. (American Savings Bank), California, 1996
  • Utah Federal Savings Bank, 1996
  • Western Bank, Oregon , 1996
  • Enterprise Bank, Washington, 1995
  • Olympus Bank FSB, Utah, 1995
  • Summit Savings Bank, Washington, 1994
  • Far West Federal Savings Bank, Oregon, 1994
  • Pacific First Bank, Ontario, 1993
  • Pioneer Savings Bank, Washington, 1993
  • Great Northwest Bank, Washington, 1992
  • Sound Savings & Loan Association, Washington, 1991
  • CrossLand Savings FSB, Utah, 1991
  • Vancouver Federal Savings Bank, Washington, 1991
  • Williamsburg Federal Savings Association, Utah, 1990
  • Frontier Federal Savings Association, Washington, 1990
  • Old Stone Bank of Washington, FSB, Rhode Island , 1990

collapse

On September 25, 2008, in the wake of the financial crisis since 2007, the bank collapsed with customer deposits of 188 billion US dollars and assets of 307 billion US dollars , making it the largest bank failure in US history. A collapse with a corresponding burden on the US deposit insurance fund was prevented by a partial takeover by the US bank JP Morgan Chase for 1.9 billion US dollars.

According to the Federal Deposit Insurance Corporation (FDIC), the US savings bank regulator , there had been cash outflows of 16.7 billion dollars since the middle of the month and thus acute liquidity problems, so that the bank could no longer meet its obligations. The losses over the past three months were $ 6.1 billion. According to the Office of Thrift Supervision , which closed the bank and handed it over to the FDIC, the bank was liquid to the end. The company was particularly involved in the mortgage market .

Washington Mutual's closing price on September 25 was $ 1.51, and its 52-week high was $ 39.25. Before mid-2007, the share price had hovered in a narrow range around $ 50 for years.

Chapter 11 insolvency proceedings

One day after Washington Mutual Bank (WMB) closed, Washington Mutual Inc. (WMI), the holding company of the Washington Mutual Group, filed for bankruptcy on September 26, 2008 ( Chapter 11 in US law ). The law firm Weil, Gotshal & Manges took over the representation of the WMI. In filing for bankruptcy, WMI had $ 32.9 billion in assets and $ 8.2 billion in liabilities.

As a result, WMI and Weil filed various lawsuits against the FDIC and JP Morgan Chase in the Delaware and Columbia bankruptcy courts , with amounts in dispute in excess of $ 17 billion. The holding company is demanding reimbursement of the $ 6.5 billion capital contribution and $ 4 billion of trust-preferred security that were transferred to WMB shortly before the bankruptcy. In addition, there are 3 billion US dollars in tax refunds and 4 billion US dollars in deposits that the holding company had in an account with WMB at the time of the closure.

WMI also called for fair compensation for the assets the FDIC transferred from WMB to JP Morgan for just $ 1.9 billion. According to independent experts, it was worth more than 50 billion US dollars. Due to a change in law during the bankruptcy process, WMI was entitled to an additional $ 5.6 billion in tax refunds for loss carryforwards from the past 5 years.

At the end of December 2009, however, WMI and Weil suddenly and without explanation stopped the lawsuits filed and the prosecution of possible claims. The US trustee, based at the US Department of Justice and after americ. Right a higher authority for Chapter 11, then called for "urgent reasons" a shareholder representative ("Equity Committee"). On January 28, 2010, Judge Mary Walrath approved the Equity Committee on the grounds that WMI "is not hopelessly bankrupt".

Nonetheless, on March 12, 2010, WMI and Weil submitted a reorganization plan to the court, which provided for dropping all lawsuits against the FDIC and JP Morgan, dividing tax refunds among themselves and ultimately writing off the WMI shareholders worthless due to a lack of remaining assets.

In return, the Equity Committee had submitted several motions to the court demanding that WMI's books and a complete list of all assets be inspected and that a shareholders' meeting be held again after more than two years. In April 2010 the court confirmed that shareholders have the right to an annual shareholders' meeting even during bankruptcy.

At the request of the Equity Committee and upon presentation of the latest evidence, the court appointed an independent auditor in August 2010 to provide a complete and transparent list of all WMI assets and the prospects of success of the ongoing lawsuits against the FDIC, JP Morgan and possibly other parties to assess objectively.

On September 7, 2010, Examiner Joshua Hochberg of US law firm McKenna Long presented his preliminary investigation report. At the same time, he asked the court for more time to investigate relevant matters, to sift through further documents and to question those responsible at JP Morgan, the FDIC and other authorities as well as third parties. The court granted the examiner's request, who was originally due to submit its final report by October 8th.

On Nov. 1, 2010, Hochberg submitted his eagerly awaited report, but it did not meet the court's expectations. Among other things, Hochberg failed to question witnesses under oath; and many of his conclusions were drawn from sources covered by legal privilege. On December 12, 2010, the court therefore ruled that the report could not be used as evidence in court.

On May 24, 2011, Washington Mutual announced that it had reached a preliminary agreement with the creditors and the Equity Committee to end the bankruptcy in mid-August. How the restructuring of the Sparkasse looks and will be implemented will be announced in the coming months.

See also

Web links

Commons : Washington Mutual  - collection of images, videos, and audio files

Individual evidence

  1. ^ Hoover's: Washington Mutual - Company Overview
  2. tagesschau.de, Sparkasse Washington Mutual collapsed - Biggest bank failure in the USA , Sept. 26, 2008 ( Memento from September 26, 2008 in the Internet Archive )
  3. ^ Frankfurter Allgemeine Zeitung GmbH: Washington Mutual: Biggest bank failure in American history. September 26, 2008. Retrieved November 23, 2017 .
  4. FTD, billion- dollar bankruptcy of the largest US building society Washington Mutual collapses, September 26, 2008 ( Memento from July 31, 2012 in the web archive archive.today )
  5. Office of Thrift Supervision - Fact Sheet ( Memento from October 1, 2008 in the Internet Archive ) (PDF document; 32 kB)
  6. FDIC Press Release: JPMorgan Chase Acquires Banking Operations of Washington Mutual - September 26, 2008
  7. http://www.reuters.com/article/idUSTRE48Q09Y20080927
  8. ^ Washington Mutual sues FDIC for over $ 13 billion . In: Reuters . March 21, 2009 ( reuters.com [accessed November 23, 2017]).
  9. http://www.law.com/jsp/article.jsp?id=1202434948271
  10. Lawrence J. White: The WaMu Story . In: Forbes . ( forbes.com [accessed November 23, 2017]).
  11. WaMu may see life after bankruptcy, thanks to taxes . In: Reuters . March 29, 2010 ( reuters.com [accessed November 23, 2017]).
  12. Troy Racki: WaMu accuses Shareholders of Milking System . In: Seeking Alpha . April 29, 2010 ( seekingalpha.com [accessed November 23, 2017]).
  13. UPDATE 1-WaMu shareholders get their voice in bankruptcy . In: Reuters . January 28, 2010 ( reuters.com [accessed November 23, 2017]).
  14. http://www.businessweek.com/news/2010-03-12/wamu-jpmorgan-settle-dispute-over-4-billion-lawyer-says.html
  15. http://www.law.com/jsp/article.jsp?id=1202464451332&rss=newswire
  16. http://www.businessweek.com/news/2010-08-10/wamu-examiner-wins-approval-on-scope-of-investigation.html
  17. http://www.nytimes.com/aponline/2010/09/07/business/AP-US-Washington-Mutual-Bankruptcy.html?_r=2
  18. http://www.forbes.com/feeds/ap/2010/12/02/business-financials-us-washington-mutual-bankruptcy_8178797.html
  19. ^ Insurance and banks »News about financial service providers. Retrieved November 23, 2017 .