Wachovia Bank reports $23.9 billion loss in Q3

October 22, 2008 by · Leave a Comment
Filed under: Industry News 

Another impressive loss from this financial titan.  

Release:

Wachovia Corp reported a third-quarter loss of $23.9 billion on Wednesday, a record quarterly deficit for a banking company in the global credit crisis, underscoring the challenges Wells Fargo & Co faces when it acquires the big lender.

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Citigroup Demands Wachovia and Wells Fargo Terminate Merger Deal

October 3, 2008 by · Leave a Comment
Filed under: Bank Failure 

I take issue with this. Why would Citigroup be so up in airs about this deal for Well Fargo to take over Wachovia? Well beside getting a fire sale price because of the banks distressed position, nothing. The problem with these latest deals is that the banks have been cherry picking these large commercial banks for their best assets and then leaving the holding company with all the bad assets that literally wipe out the shareholders and in some cases the bondholders as well. What we are forgetting is Wells Fargo is doing what atleast half of America has been calling for “A Free Market Solution“. This is not Wells just taking the bank deposits and run, they are taking the whole enchilada including the stuff some might not prefer. But now that we have these government sponsored or backed deals people would rather have intervention in the market then take part in the downside just as they took part in the upside. Here is what an analyst said that really hits home to what I am taking about with regards to the mentality now that the government is getting involved, “Citigroup loses an attractive, accretive deal, complete with government assistance. David Trone, an analyst with Fox- Pitt Kelton Cochran Caronia Waller in New York, wrote in a note today.

Bloomberg Article:

Citigroup Inc. demanded that Wells Fargo & Co. and Wachovia Corp. terminate a $15.1 billion takeover agreement announced today, saying it breached an exclusive deal the New York-based company reached earlier this week.

Citigroup, led by Chief Executive Officer Vikram Pandit, dropped as much as 15 percent in New York trading after San Francisco-based Wells Fargo said it would buy Wachovia in an all- stock transaction. Citigroup announced a $2.16 billion offer for parts of the company four days ago.

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Citigroup to buy Wachovia banking assets

September 29, 2008 by · 1 Comment
Filed under: Bank Failure, Industry News 

Along with National City, these are the next shoes to drop in this financial crisis. This is normal workings in the market after such a huge bubble that we should be accepting to see this happen. It would be more worrisome if we did not see bank failures and some plan to keep failed banks solvent. You might think that a plan like this is already in the works and you are correct. I am surprised to see Citigroup buying other banks asset when they are one of the most leveraged institutions in the market. What is also interesting is the fact they are opening themselves to $42 billion in bad loan exposure.

Press Release:

Citigroup Inc will buy the banking operations of Wachovia Corp in a deal brokered by the Federal Deposit Insurance Corp, the FDIC said on Monday.

The deal comes as authorities step in to rescue three European banks and as U.S. lawmakers prepare to vote on a $700 billion bailout of U.S. financial firms.

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Wachovia Sells Land, Construction Loans to LandCap

August 20, 2008 by · Leave a Comment
Filed under: Real Estate News 

This seems to be a common theme among banks to get the declining value assets of their balance sheet and into some joint-venture or separate entity to help them with write-offs. We should look too see more of this as they get this and other instruments that may be off-balance sheets.

A joint venture created by LandCap Partners is buying $40 million of troubled land and construction loans from Wachovia Corp The Wall Street Journal said. LandCap, a residential-land company headed by real-estate veteran Jeffrey Gault, has created a joint venture that will buy the loans which have a book value of $75 million to $80 million, the paper said citing people familiar with the deal.

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