WaMu Is Cut to Junk by S&P on Mortgage Losses: Shares Decline

[marmar]

WaMu Rating Lowered to Junk by S&P on Mortgage Losses (Update3)

By Ari Levy

Sept. 15 (Bloomberg) -- Washington Mutual Inc., the biggest U.S. savings and loan, had its credit rating cut to junk by Standard & Poor's because of the deteriorating housing market.

S&P reduced its rating on Seattle-based WaMu to BB- from BBB-, leaving it three levels below investment grade, the ratings firm said today in a statement.

``Increasing market turmoil and the related impact from managing its concentrated mortgage franchise in this troubled housing and credit cycle led to the downgrade,'' S&P wrote. S&P cut its rating on the subsidiary bank to BBB- from BBB.

S&P followed similar announcements last week from Moody's Investors Service and Fitch Ratings. WaMu, which has reported $6.3 billion of losses in the last three quarters because of soured mortgages, said on Sept. 11 that it expects a third- quarter loan loss provision of $4.5 billion.

WaMu tumbled 73 cents, or 27 percent, to $2 at 4 p.m. on the New York Stock Exchange. The shares dropped another 20 cents, or 10 percent, to $1.80 in extended trading. They've lost 94 percent of their value in the past year. .....(more)

The complete piece is at: http://www.bloomberg.com/apps/news?pid=20601087&sid=aCbDcNYTh_cI&refer=home

[KitchenWitch]

1. Whoo Hoo!

If anyone does not know, Whoo Hoo is a phrase in all of their new ads.

[Selatius]

2. Washington Mutual is history at this point, like Bear Stearns.

[upi402]

3. I know, I just asked how to cover my (HELOC and new credit card) butt

in another thread. Glad I was checking online daily and got my savings out last week. Thanks fellow DUers!!!

[aquart]

4. People should have bailed when they started appearing on every corner.

How could all those storefront operations NOT make people suspicious?

[terrya]

5. So...what if you bank at Washington Mutual?

What if you have a checking account...and have your paycheck direct deposited to said Washington Mutual checking account? I do. Am I fucked?

[RollWithIt]

6. Hmmm, my Home Equity loan is with them....

I'm in good standing, what does this mean to me?

[colorado thinker]

7. My 15 year fixed term mortgage

(7 years left to pay) is with Wamu. Suppose they'll forgive the loan to divest themselves of mortgage debt? Who's left to sell my mortgage to? :evilgrin: