And the winner of the bank race to the bottom? WaMu

[c1ue]

http://www.sfgate.com/cgi-bin/articl...BUS912RO1U.DTL

At the same time, the company said its regulator, the Office of Thrift Supervision, has put it under special supervision, requiring it to improve risk management and compliance procedures, and provide a multiyear business plan, including a forecast for earnings, asset quality and capital. Washington Mutual said the plan will not require it to raise capital, boost liquidity or cut products and services.

WaMu officially under the Office of Thrift Supervision: the end?

[rj1]

Re: And the winner of the bank race to the bottom? WaMu

http://www.sfgate.com/cgi-bin/articl...BUS912RO1U.DTL



WaMu officially under the Office of Thrift Supervision: the end?

What I read was it was more akin to "probation".

I think they'll go in at least a month if not less, and there won't be any parachute or buyer. You have to imagine it'd be pretty expensive for the FDIC.

[c1ue]

Re: And the winner of the bank race to the bottom? WaMu

Sure, its called 'probation'.

But how quick do you think the lines will form once people figure out this is the first step to FDIC takeover?

And how much of Wamu's deposits are going to flee?

[nathanhulick]

Re: And the winner of the bank race to the bottom? WaMu

Sure, its called 'probation'.

But how quick do you think the lines will form once people figure out this is the first step to FDIC takeover?

And how much of Wamu's deposits are going to flee?

The question I keep asking myself, is why havent the deposits left already? It seems pretty likely that barring some kind of drastic action, Wamu is going out of business sooner rather than later. Once that happens, there are sure to be lines of people on the news complaining that the FDIC isnt letting them get their money.

Why wouldn't people avoid that whole problem by heading down there right now and getting their money with no hassles? Is it because people aren't paying attention, or they know about the news, but think Wamu is going to be just fine?

[c1ue]

Re: And the winner of the bank race to the bottom? WaMu

Up until now - WaMu has been considered too large to fail.

But with the OTS thing - the somewhat less informed are going to start wondering if this assumption is correct.

Certainly I'm going to be closely observing the WaMu branches in my area.

[photoncounter]

Re: And the winner of the bank race to the bottom? WaMu

Can someone comment on how bad is the hassle (if at all) to claim your money from FDIC. I did withdraw some cash, but am wondering about the rest.

Also, I read somewhere few months ago (don't recollect where) that "legally" FDIC can repay over a number of years. I reckon, normally this is not the case, but is it true ?

Thanks in advance.

[pwcmba]

Re: And the winner of the bank race to the bottom? WaMu

New proposal coming out of Treasury and the FRB via Congress:
Shortened work week (think 3 days on - 4 days off) to allow for compressed failure cycles. The work week would begin on Wed! We can’t make it to Friday with the failures anymore so why not bring Friday to us all that much quicker! Also, we have the added benefit of the long weekend to cobble together these quickened bailouts!

[metalman]

Re: And the winner of the bank race to the bottom? WaMu

Can someone comment on how bad is the hassle (if at all) to claim your money from FDIC. I did withdraw some cash, but am wondering about the rest.

Also, I read somewhere few months ago (don't recollect where) that "legally" FDIC can repay over a number of years. I reckon, normally this is not the case, but is it true ?

Thanks in advance.

so far the banks stay open under new ownership. if the fdic doesn't pay up right quick they lose all cred and the system goes bust. i wouldn't worry about it in this cycle. if this keep up a few years, that's another matter.

[The Outback Oracle]

Re: And the winner of the bank race to the bottom? WaMu

The question I keep asking myself, is why havent the deposits left already? It seems pretty likely that barring some kind of drastic action, Wamu is going out of business sooner rather than later. Once that happens, there are sure to be lines of people on the news complaining that the FDIC isnt letting them get their money.

Why wouldn't people avoid that whole problem by heading down there right now and getting their money with no hassles? Is it because people aren't paying attention, or they know about the news, but think Wamu is going to be just fine?

Crikey! What's the matter with you Nathan? Hank and George telling them the US economy is just dandy! Why worry?
I am starting to wonder what the word "flexible" means when referring to the US Economy. The MSM keeps saying the US Econ omy will be Ok because it is "so flexible"

[metalman]

Re: And the winner of the bank race to the bottom? WaMu

Crikey! What's the matter with you Nathan? Hank and George telling them the US economy is just dandy! Why worry?
I am starting to wonder what the word "flexible" means when referring to the US Economy. The MSM keeps saying the US Econ omy will be Ok because it is "so flexible"

holy shit! you ausies really do say 'Crikey'

paulson & co. think an economy is 'flexible' if they can fold it up and stuff it in their pocket.

[zoog]

Re: And the winner of the bank race to the bottom? WaMu

The question I keep asking myself, is why havent the deposits left already? It seems pretty likely that barring some kind of drastic action, Wamu is going out of business sooner rather than later. Once that happens, there are sure to be lines of people on the news complaining that the FDIC isnt letting them get their money.

Why wouldn't people avoid that whole problem by heading down there right now and getting their money with no hassles? Is it because people aren't paying attention, or they know about the news, but think Wamu is going to be just fine?

Up until now - WaMu has been considered too large to fail.

But with the OTS thing - the somewhat less informed are going to start wondering if this assumption is correct.

Certainly I'm going to be closely observing the WaMu branches in my area.

My answers to nathanhulick are:

1) The vast majority of WaMu customers have probably not heard anything that might give them genuine concern about the bank until the past week or so. If you don't follow the financial news specifically, you've probably missed the various warnings until now. It all seemed so far away.

2) C1ue's answer. Even for those who have been paying attention, and I'm speaking for myself here, a reluctance to take the relatively alarmist action of pulling all your money out of the bank when doubts remained about "just how serious are their problems, really?" and "even if, the FDIC will give me my money back, right?"

3) It's a hassle.

I shopped around online, talked to friends, and settled on a local credit union. Unlike WaMu, they don't have Saturday hours at a branch conveniently located near my home. So I had to take time off work, drive to WaMu, close my savings account, then drive to the nearest credit union branch, open accounts with the savings money. I had to talk to the accounting department where I work to get my paycheck direct deposit switched over. I had to log onto various websites to change automatic billing to the new account. I am still waiting for my checks and ATM card to arrive. I was going to leave the WaMu checking account open until I received those, but since I pay most of my bills electronically, and got a little nervous this week that WaMu might not last through the weekend (though it sounds like there will be a buyer), so on Friday I took time off again to close my other WaMu account and take that to the new bank.

I'm sure I just sound like I'm complaining, but the point is that there is some time and effort involved. I've been with WaMu for several years, and have been happy with them. I didn't want to believe that I needed to take this step. Perhaps, with the new taxpayers-to-buy-all-your-problems solution for the banks, it will turn out to have been unnecessary. I just decided to not stick around to find out.

The teller noted the cashier's check was from WaMu and so we chatted about it. She said "yesterday we had a lot of people coming in [to switch from WaMu]." (This is one branch of a small credit union so take "a lot" in context.) Apparently some had attempted to get their funds in actual cash, one guy was particularly upset that they wouldn't accomodate this request. The cashier's check is supposed to be just as good, she told me, but the bank has to get their money from WaMu. I told her I had actually contemplated asking for cash, but figured the small branch wouldn't be able to hand me a few thousand in bills.

side note: where I now have the word "nervous" I originally typed the word s-p-o-o-k-e-d but while proofing my post in preview I saw it had been changed to "friended":confused::p. Ah the ever-shifting iTulip automatic überediting.:rolleyes:

[Slimprofits]

Re: And the winner of the bank race to the bottom? WaMu

Washington Mutual Inc. Downgraded to 'CCC' From 'BB-'; WAMU Bank 'BBB-/A-3' Affirmed

Standard & Poor's Ratings Services said today that it lowered its counterparty credit rating on Washington Mutual Inc. (WAMU) to 'CCC/C' from 'BB-/B'. At the same time, we affirmed the 'BBB-/A-3' counterparty credit rating on Washington Mutual Bank because of the breadth of its retail franchise.

"The downgrade was due to the increased likelihood that a potential sale of the company may not involve the whole company, which increases the risk of default for holding company creditors," said Standard & Poor's credit analyst Victoria Wagner.

We also lowered the preferred stock rating to 'CC' from 'B-' to reflect the incremental risk of default of these securities.

My account is up at the end of next month. It is time to move across the street.

[ASH]

Re: And the winner of the bank race to the bottom? WaMu

The teller noted the cashier's check was from WaMu and so we chatted about it. She said "yesterday we had a lot of people coming in [to switch from WaMu]."

My company is small enough that I was able to talk the owner into moving some company funds out of WaMu such that he will be protected by FDIC when WaMu folds. He told a very similar story to yours, regarding comments from both the cashier and the manager at the bank he opened an account at. This was two weeks ago. Strangely, however, I see no lines forming. Apparently the "proactive" money is a small fraction of the total.

As for why more people aren't pulling their money out... while arguing with my boss to pull the company's money out, he kept saying he "couldn't believe that the Feds would let businesses take such a big hit at a thrift as large as WaMu." That was his gut reaction, but fortunately he's a pretty smart businessman, so risk management got the better of him. (And I kept harping on the fact that money in excess of the FDIC limit was by no means guaranteed.) Still, I think the general population is not yet clued into how serious this thing is.

[photoncounter]

Re: And the winner of the bank race to the bottom? WaMu

Here's a story of 20K gone (almost):

http://www.cnn.com/video/#/video/bus...safety.net.cnn

[GRG55]

Re: And the winner of the bank race to the bottom? WaMu

Washington Mutual Inc. Downgraded to 'CCC' From 'BB-'; WAMU Bank 'BBB-/A-3' Affirmed

Another weekend approaches. Another Sunday evening bailout to announce...