Washington Mutual, Inc. known to its friends as "WaMu", was a savings bank holding company and the former owner of Washington Mutual Bank, which was the United States' largest savings and loan association.
On September 25, 2008, the United States Office of Thrift Supervision seized Washington Mutual Bank from Washington Mutual, Inc. and placed it into the receivership of the FDIC. The OTS took the action due to the withdrawal of $16.4 billion in deposits, during a 10-day bank run amounting to 9% of the deposits it had held on June 30, 2008. The FDIC sold the banking subsidiaries (minus unsecured debt or equity claims) to JPMorgan Chase for $1.9 billion, which re-opened the bank the next day. The holding company, Washington Mutual, Inc. was left with $33 billion assets, and $8 billion debt, after being stripped of its banking subsidiary by the FDIC.
The next day, September 26, Washington Mutual, Inc. filed for Chapter 11 voluntary bankruptcy in Delaware, where it is incorporated. Washington Mutual Bank's closure and receivership was the largest bank failure in American financial history. Before the receivership action, it was the sixth-largest bank in the United States.
So what do you do if you are the out of work Chief Risk Officer of such a bank? Why, you join the lecture circuit and tell people how hard it is to run a bank.
Well good luck to Mr Cathcart and his "interactive session with a former chief risk officer of a top bank". Perhaps that should be "An interactive session with the penultimate chief risk officer of a former top bank".
2 comments:
Ron Cathcart was not the Chief Risk Officer for a year before the failure. He left the bank in 2007.
Welcome Anonymong. Do you know the meaning of the world penultimate? It means the one before last.
It takes much longer than a year to screw up a bank beyond repair. The practices that led to the downfall of WaMu would have started under Cathcart, if not before.
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