WWTBAM Bored

The news just came in. The FDIC took them over and sold them to Citi.

Update: Wachovia's brokerage and securities groups (formerly AG Edwards and Evergreen Investments) is going to continue to operate. Citi is just getting the banking part.

Bob Juch wrote:The news just came in. The FDIC took them over and sold them to Citi.

Well, not quite. The FDIC facilitated Citi's purchase of Wachovia's banking operations, but did not at any time actually take over Wachovia. Word in the banking world (around here, anyway) is that Wachovia was waiting for/hoping that the bailout would come about in time to keep them independent, but it looks like even that will not be enough for them.

http://www.fdic.gov/news/news/press/2008/pr08088.html

Dang, I just bought a new set of Wachovia checks...

wintergreen48 wrote:

Bob Juch wrote:The news just came in. The FDIC took them over and sold them to Citi.

Well, not quite. The FDIC facilitated Citi's purchase of Wachovia's banking operations, but did not at any time actually take over Wachovia. Word in the banking world (around here, anyway) is that Wachovia was waiting for/hoping that the bailout would come about in time to keep them independent, but it looks like even that will not be enough for them.

http://www.fdic.gov/news/news/press/2008/pr08088.html

Dang, I just bought a new set of Wachovia checks...

Right, the news always gets it a bit muddled at first.

They charged you for checks?

Wachovia was one of the best banks in the country before First Union took them over.

Good article that explains why Wachovia got into trouble:

http://www.bloomberg.com/apps/news?pid= ... refer=news

I should have known there was something wrong at Wachovia long before the public notice; one of our big vendors bailed on them as a collection center long, long before the public notice. Companies change collection centers (where you mail the check to; lot of companies farm that out now; it being a bank is ideal, generally, as they can just log the $$ in & deposit it in your account) frequently, so I thought nothing of it at the time.

Wachovia was fine until it bought Golden West and all those bad mortgages.

Ritterskoop wrote:Wachovia was fine until it bought Golden West and all those bad mortgages.

It was the management that came from First Union that did it.

Bob Juch wrote:

Ritterskoop wrote:Wachovia was fine until it bought Golden West and all those bad mortgages.

It was the management that came from First Union that did it.

Wachovia was fine until it took over First Union's bad Golden West purchase.

Ritterskoop wrote:

Bob Juch wrote:

Ritterskoop wrote:Wachovia was fine until it bought Golden West and all those bad mortgages.

It was the management that came from First Union that did it.

Wachovia was fine until it took over First Union's bad Golden West purchase.

First Union was the Charlotte based bank - it was bigger than Wachovia, but had a bad (but well deserved reputation) for being a low-service operation. They bought Wachovia in 2001 and took the Wachovia name for the combined operation - because Wachovia had a much better brand and reputation. But most tof the leaders of the combined operation were First Union folks.

They are the ones who bought Golden west - a huge mistake - they ahd made a smaller manageable mistake with "The Money Store" in the late 90's.

it is not a good day for us Charlotteans.

I am the recipient of one of those Golden West mortgages. I've been following this story for a long time and was surprised to learn how bad the Golden West portfolio was. When we applied for a mortgage, we were put through the paces and they verified all information. The process was with GW (World Savings) directly, not through any broker and compared to friends and peers going through the process with other institutions simultaneously (in 2004), I'd say the vetting was quite rigorous.

What we got was a fantastically flexible adjustable rate mortgage that is pegged to the rates that the bank pays its depositors, not to prime. There was no teaser rate, no balloon payment, no surprises of any kind. One consideration was the GW tended to hold their own portfolio, unlike everyone else who bundled them and sold them to Freddie or Fannie.

I was disappointed when it was sold to Wachovia. We started receiving idiotic letters from them that suggested they didn't know anything about our mortgage.

I'm not sure what happens now or who owns the mortgage.

bazodee wrote:I'm not sure what happens now or who owns the mortgage.

You probably don't know who owns the mortgage anyway. That's been part of the problem with people trying to renegotiate when they've had difficulty paying. With all the bundling and reselling going on, no one knows who to talk to for renegotiating.

Up until today it was owned and serviced by Wachovia. Since they acquired it in 2007, they wouldn't have been able to bundle it given the market's recent reluctance toward unconventional instruments.

For the record, I didn't mean to suggest that our mortgage was distressed. It is not. We are very, very satisfied with the terms. One of the flexible options of the mortgage was to pay as if it were a 15 year fixed rate, which we have done for its entire life.

i am surprised wells fargo hasnt tanked
they were big in subprimes

BigDrawMan wrote:i am surprised wells fargo hasnt tanked
they were big in subprimes

Wells Fargo was the other bank bidding for Wachovia.

Bob Juch wrote:

BigDrawMan wrote:i am surprised wells fargo hasnt tanked
they were big in subprimes

Wells Fargo was the other bank bidding for Wachovia.

i heard they wanted to use subprime mortgages to pay for it

BigDrawMan wrote:

Bob Juch wrote:

BigDrawMan wrote:i am surprised wells fargo hasnt tanked
they were big in subprimes

Wells Fargo was the other bank bidding for Wachovia.

i heard they wanted to use subprime mortgages to pay for it

They probably would have!

The market is up 2% today; Citi is up almost 8%. Someone loves us.