JPMorgan Chase Acquires Deposits, Assets, Liabilities Of Washington Mutual

Posted by Orb Staff on September 26, 2008 No Comments
Categories : Residential Mortgage

JPMorgan Chase & Co. has acquired all deposits, assets and certain liabilities of Washington Mutual's banking operations from the Federal Deposit Insurance Corporation (FDIC), effective immediately. Excluded from the transaction are the senior unsecured debt, subordinated debt, and preferred stock of Washington Mutual's banks.

JPMorgan Chase will not be acquiring any assets or liabilities of the bank's parent holding company or the holding company's non-bank subsidiaries. As part of this transaction, JPMorgan Chase will make a payment of approximately $1.9 billion to the FDIC.

According to the company, the acquisition expands Chase's consumer branch network into California, Florida and Washington and creates the nation's second-largest branch network, with locations reaching 42% of the U.S. population. The acquisition also extends Chase's retail branch network to additional states, including Georgia, Idaho, Nevada and Oregon.

In conjunction with this acquisition, JPMorgan Chase will be marking down the acquired loan portfolio by approximately $31 billion, which primarily represents our estimate of remaining credit losses related to the impaired loans. JPMorgan Chase adds that it intends to raise additional capital in connection with this transaction to maintain the company's strong capital position.

Source: JPMorgan Chase

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