Largest bank folding in history

[ricoba]

It's interesting to read that the move was partially precipitated by a run on deposits this past week.

 

[Icarus]

http://www.latimes.com/news/nationworld/nation/la-fi-wamu26-2008sep26,0,1985754.story

-David

 

[swift]

We have our personal accounts at a credit union but my DH's business accounts are at WAMU. I asked him not to long ago if he could move the business over to the credit union because it would be more convenient for us. He said he couldn't because the credit union does not take business accounts. When I asked him why he said he didn't know. Is there a reason? Is this all credit unions or just the one we have?

 

[applegirl]

So what happens to WaMu stock? Will it ever recover or do we just cut our losses. We have a small amount of WaMu stock.

Does a companies stock just disappear when the company goes under?

Someone explain please!

janna

 

[ricoba]

So what happens to WaMu stock? Will it ever recover or do we just cut our losses. We have a small amount of WaMu stock.

Does a companies stock just disappear when the company goes under?

Someone explain please!

janna

As I remember, here's the normal pecking order of payments in situations like this, creditors, bond holders, preferred shareholders, common share holders.

Since common shareholders(the kind you most likely are) are the last to be paid they may get something. But considering the last quote I saw on the shares was $.16 cents, I doubt you will ever see any money.

 

[Grand Vic]

I found this on FOX News. Something really stinks here in my opinion.

http://www.foxnews.com/story/0,2933,428641,00.html

 

[Bill4728]

I live in northwest Washington. They reported on the evening news here that this was not a bank failure or closure - it was a sale. Further, Chase is only buying a portion of Wamu, and Wamu as a company is not going under. So somebody is mistaken here someplace.

Before anyone gets all fired up about what may or not change, I recommend getting more of the facts of the situation.

Dave

This was a bank failure and not a sale. That is why the WaMu share holders get ZERO!!


What happened was after the FDIC took the bank ( that is the failure!!), the FDIC then sold the bank to JP Morgan/Chase. Chase got the whole thing so no one lost a dime ( even those with more than the insured amount)

I heard today that WaMu turned down an offer from Chase last week for the whole company at $8/share but WaMu want more ( the stock was trading last week around $2-$3 /share) So now the greedy owners of WaMu get nothing!!

So what happens to WaMu stock? Will it ever recover or do we just cut our losses. We have a small amount of WaMu stock.

Does a companies stock just disappear when the company goes under?

Yes, the company has failed and the stock is worthless. ( some people are hoping that a stock holder may get a small amount which is why the stock is currently at $0.16/share)

 

[SDKath]

I found this on FOX News. Something really stinks here in my opinion.

http://www.foxnews.com/story/0,2933,428641,00.html

Oh my! This is outrageous. That should be money returned to the FDIC for crying out loud.

 

[UWSurfer]

We have our personal accounts at a credit union but my DH's business accounts are at WAMU. I asked him not to long ago if he could move the business over to the credit union because it would be more convenient for us. He said he couldn't because the credit union does not take business accounts. When I asked him why he said he didn't know. Is there a reason? Is this all credit unions or just the one we have?

While I'm not certain, I think it largely has to do with the way credit unions are chartered in the US. From Wikapedia :"A credit union is a cooperative financial institution that is owned and controlled by its members, and operated for the purpose of promoting thrift, providing credit at reasonable rates, and providing other financial services to its members."

They are not-for-profit organizations and while I suppose a group of businesses could have a business credit union, I'm betting that the banking industry influenced the laws so that won't happen...or at least until this present crisis came upon us.

 

[Icarus]

So what happens to WaMu stock? Will it ever recover or do we just cut our losses. We have a small amount of WaMu stock.

Does a companies stock just disappear when the company goes under?

Someone explain please!

janna

Well, WM will certainly be delisted from the NYSE, but it will still be possible to trade the shares as long as they have some value and there are buyers for them.

If you want to book the loss, you will have to sell your shares. If the stock becomes worthless, usually your brokerage will buy them from you for a penny so you can book the loss. There's probably other tax rules and methods for dealing with worthless assets, but I'm not familiar with them. I think the easiest method is to sell them to the brokerage. They do it as a service for their clients.

-David

 

[Debbyd57]

This is so sad. We had an account there for many years until a year ago when we moved to Mississippi. I always liked Washington Mutual. They were very good to us.

 

[DaveNV]

WaMu is done, Dave. Stick a fork in it if you don't believe it. Of course, the TV news there must be right because it's TV. I suppose there could be some part of the corporate entity that remains intact, but I doubt it. The entire thing will be sold off to pay it's creditors, I'm sure.

-David

You're absolutely right, of course, David. I was referring to what the talking heads said on the Seattle evening news. Their story was GREATLY different today. They'd been going on in great detail that it wasn't a failure, that it was only a partial sale, and so forth. They even had interviews with Wamu staff who went on and on about how it was no big deal, nobody loses anything, just selling part of the parent company, and blah blah blah. Imagine my surprise when I catch the news later on, and hear the exact things you were describing. I'm sorry if anyone here ends up losing anything due to Wamu's lousy performance.

I quit banking with them a number of years ago, after they outright lied to me about sharing their customer list with telemarketers and junk mail companies. They swore they NEVER did anything like that, and how their customer information was private, and so forth. When I dropped a ton of junk mail on the counter, and asked them to explain to me how it was possible that I was now receiving the erroneous mail from one of their other customers, they had nothing to say.

(The other person had the same last name, but a different first name - off by one letter. When I moved, Wamu changed HIS name and address to my new home, instead of my own account. I received many things from Wamu with his name on it, including bank statements, and his new MORTGAGE PAPERS! I opened them without noticing the wrong name, and inside found all sorts of personal information. If I was a dishonest person, I could have done all sorts of bad things with that information. It took weeks to get it straightened out. His name never appeared anywhere but on paperwork sent by the bank.)

So the kicker for me was that I started receiving TONS of junk mail for him, AND HIS WIFE, together or as individuals, at my new address. It's been more than five years, but I still get junk mail for them now and then.

But of course, Wamu would never, ever share personal information with outside companies. Yeah, right.

Dave

 

[Passepartout]

So what happens to WaMu stock? Will it ever recover or do we just cut our losses. We have a small amount of WaMu stock.

Does a companies stock just disappear when the company goes under?

Someone explain please!

janna

Yup. It's history in many instances.

It had already lost about 95% of it's value in a year. If you were still holding it, you weren't paying attention. Sorry.

Jim Ricks

 

[Icarus]

WM filed for chapter 11 today. The stock still exists and it still seems to be trading at 16 cents per share. A chapter 11 filing usually means that the company hopes to reorganize and emerge from bankruptcy, which is interesting in itself. WM is the holding company. It may have other non-banking assets.

Here's another interesting article on the loss of confidence and the staggering loos of deposits that occured at WaMu in the run-up to the takeover.

http://news.moneycentral.msn.com/provider/providerarticle.aspx?feed=OBR&date=20080926&id=9198714

-David

 

[MULTIZ321]

WM filed for chapter 11 today. The stock still exists and it still seems to be trading at 16 cents per share. A chapter 11 filing usually means that the company hopes to reorganize and emerge from bankruptcy, which is interesting in itself. WM is the holding company. It may have other non-banking assets.

Here's another interesting article on the loss of confidence and the staggering loos of deposits that occured at WaMu in the run-up to the takeover.

http://news.moneycentral.msn.com/provider/providerarticle.aspx?feed=OBR&date=20080926&id=9198714

-David

David,

Thanks for posting that link and for keeping us informed on what's been happening at WAMU


Richard