WaMu brushes off JPMorgan
What doesn’t JPMorgan Chase (JPM) want to buy? The big New York bank, fresh off its fire sale acquisition of Bear Stearns (BSC), made an offer last week for Washington Mutual (WM), The Wall Street Journal reports. The Journal reports JPMorgan offered $8 a share for Washington Mutual after the Seattle thrift’s CEO, Kerry Killinger, called to say his firm needed to raise capital to cushion itself against future mortgage losses. As in the Bear Stearns case, in which JPMorgan initially offered $2 a share for a stock that just days before had fetched $60, the WaMu deal was to be a take-under: Even after a sharp selloff Friday, WaMu shares closed at $10.15, more than 25% above the opening JPMorgan Chase bid. Of course, WaMu eventually decided not to pursue the JPMorgan bid in favor of a recapitalization from private equity firm TPG - a decision that left the Morgan team up in arms. “WaMu, in the world’s worst way, did not want to do a deal with Chase and tried very, very hard to avoid engaging with Chase,” one person with JPMorgan Chase told the Journal. Not to worry, though: Falling house prices and a slowing economy should mean there’s no shortage of banks that will need JPMorgan’s help.
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Sure, with Fed subsidizing every purchase using taxpayer money, JP is riding high on the hog.I wish I could get access to the Fed credit window too.