Washington Mutual - Grösste Sparkasse der USA! Chancen & Risiken. ( Seite 216)

WaMu’s credit rating cut again; retail bank strong, expert says
Atlanta Business Chronicle


Washington Mutual suffered another blow Wednesday when Standard & Poor’s Ratings Services downgraded the embattled Seattle-based bank’s creditworthiness yet again, saying the sale of the bank as a whole unit might not be likely or possible.

WaMu’s stock plunged 29.4 percent, ending at $2.26. The news follows a turbulent week for WaMu in which the company was paired in news reports with multiple potential purchasers, including J.P. Morgan Chase, Citigroup and Toronto-Dominion Bank of Canada.

According to S&P, the downgrade on WaMu’s “counterparty credit rating” from BB-/B to CCC/C was made “due to the increased likelihood that a potential sale of the company may not involve the whole company, which increases the risk of default for holding company creditors.”

Both the prior rating and the new lower one are considered “junk” status, and apply to the holding company. S&P said it affirmed its ‘BBB-/A-3’ counterparty credit rating on Washington Mutual Bank “because of the breadth of its retail franchise.”

In a written response, WaMu said that its deposit rating from S&P continued to be investment grade “and it is important to note that Standard & Poor’s rating actions do not affect the safety of customer deposits, which are insured up to the limits allowed by the FDIC.”

The bank has made a big push over the past week to reassure customers, some of whom — according to one branch employee — have been withdrawing money from the bank in the Seattle area because of concerns about its safety.

S&P, noting press reports that banking regulators may intervene in a sale, said it’s possible WaMu might not be acquired in its entirety.

“If this is the case, holding company creditors face losses, because the assets of the holding company are not sufficient to cover the full repayment of the $14.4 billion of rated unsecured debt outstanding,” according to S&P.

Standard & Poor’s Credit Analyst Victoria Wagner, who issued the statement, could not immediately be reached for comment.

Because of the stresses facing financial institutions, S&P pointed out that the available pool of large bank acquirers that “are not capital constrained or devoid of their own mortgage credit stress is quite small,” which means there’s only a slim possibility that WaMu would be purchased as a whole unit.

Alan Hess, professor of finance and business economics at the University of Washington’s Foster School of Business, pointed out that the company would be quite strong if it weren’t operating under the weight of so many bad loans.

In addition to its capital levels, which meet regulatory requirements, Hess points toward the bank’s income generated from interest on loans and revenue from sales and servicing of mortgages and consumer loans.

That combined number, he said, minus WaMu’s expenses, was a “strong” $454 million in the second quarter. “It’s an efficient originator of loans, servicer of loans and collector of deposits,” said Hess.

But taking into account the company’s provision of $5.9 billion for loan losses in the second quarter, the company’s strength is diminished, said Hess.

“This is a healthy company except for the bad loans,” he said.