Wamu WKN 893906 News !

letter and PR - what do you think 17-Sep-09 Letter
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Honorable President Obama,

It has been one year since Washington Mutual Bank was seized by FDIC
on its 119th birthday and given essentially free to JP Morgan Chase.
While FDIC continues to gloat that tax payers were not harmed,
thousand of investors, from all walks of life in the US, were wiped
out. While the media has branded WaMu as a failed bank, nothing could
be farther than the truth.


While WaMu had its problems like the rest of the banking sector, it
had sufficient reserves to survive the economic down turn. Wamu had to
endure coordinated rating downgrades and excessive naked shorting of
its shares . WaMu's request to SEC to place its shares in the short
seller ban list was denied unlike those of other banks.


As recently as 2 weeks before the seizure OTS did not require the
company to raise capital.


At the pretext of a bank run (which we now know was system wide) WaMu
was seized and without a transparent bidding process sold to JPMC for
a mere 1.9 billion. WaMu's liquid cash assets were 21 billion at that
point and over 50 billion in other assets. WaMu had more than
sufficient liquid cash at hand which it would have used if it were
ever formally requested by OTS, which it never did.


Former administration's agenda was made clear by the comment Mr.
Paulson to the CEO: 'You should have sold to JPMorgan Chase in the
spring, and you should do so now.'


As a shareholder of Washington Mutual, I feel that my money among that
of many others was used to bail out JPMC with explicit help from FDIC.

Good morning from Seattle,

I just came back from a meeting this morning that included a former WAMU executive. The meeting wasn't really about WAMU directly, but he shared several stories from his experience at WAMU that I found quite interesting. He maintained a good attitude toward all involved, was a true professional.

In short I wanted to share here are a few items of interest(nothing new really, but thought some might appreciate):
1.) He doesn't believe there is a smoking gun
2.) He listed four reasons that WAMU failed
A.) They grew really quickly, and were in the process of consolidating many acquisitions.
B.) Mortgages were a significant part of their business, and they had begun doing sub-prime mortgages without developing a lot of experience in the sector at a bad time.
C.) Liquidity issues, $16B had been withdrawn in the week leading upto September 26th, 2008.
D.) Timing was bad, TARP still under debate in congress, and FDIC couldn't afford a bank failure of that magnitude at that juncture in time (even if it was only a 5% likelyhood).
3.) WAMU was working hard to align all of their internal operations, and was taking good care of their people and customers as they went.
4.) WAMU was very innovative as a retail banking opperation, and was certainly envied by many in the banking industry.
5.) This particular executive helped find most of the people in his department jobs after they were laid off by JPM.
6.) Mentioned that some "experts" expect upto 1,000 more bank failures during the next 12 months or so.