WaMu deal closed, but somethings fishy

As Washington State was ground zero for the WaMu seizure and sale to JPMorgan Chase because WaMu was based in Seattle, the Puget Sound Journal has been particularly diligent in tracking down information about the process and the aftermath and reported several stories last year about how the sale of WaMu to JPMorgan Chase wasn’t actually closed, leading to speculation that JPMorgan Chase might be made to pay more for what they bought.

But not, in a strange and fishy twist, the FDIC now says that at least some of the reports of the sale closing being extended are wrong, and the sale was closed last September.

The sale of Washington Mutual to JPMorgan Chase & Co. closed Sept. 1, 2010, according to the Federal Deposit Insurance Corp., who said today a previous statement that the sale had been extended through October 2010 was incorrect. The Seattle thrift was closed by regulators on Sept. 25, 2008.

Last August, a document surfaced that revealed the two-year-old sale was still pending because of an extension, supposedly one of many. The last time I checked with the FDIC about the status of the sale was early October 2010, and at that time spokesman Andrew Gray said the final closure date had been pushed out another 30 days.

However, that information was incorrect, he told me this week. The last extension had a Sept. 30, 2010 deadline, not Oct. 30, 2010 like he thought. The sale was closed on Sept. 1, 2010, said Gray.

“For some reason I was told that there was a second extension and that was not the case,” said Gray in an email.

The terms of the deal remain the same, he said. JPMorgan purchased WaMu’s assets for $1.88 billion from the FDIC. Some shareholders held out hope the extension of the sale would mean the purchase price may increase, especially since JPMorgan bought the thrift for a small fraction of its $307 billion in assets at the time it was closed.

However, Gray confirmed the details of the purchase and assumption agreement, which are available on the FDIC website, have not changed. I have submitted a request through the Freedom of Information Act for all the extension documents, and have been told that request will be expedited. I’ll post them on our website as soon as I receive them.

Read more …

No Comments

No comments yet.

RSS feed for comments on this post. TrackBack URI

Leave a comment

WordPress Themes