Reply #3: Five banks exploring WaMu records

[Demeter]

http://www.ft.com/cms/s/0/8324772c-85af-11dd-a1ac-0000779fd18c.html


By Saskia Scholtes in New York

Published: September 18 2008 20:19 | Last updated: September 18 2008 23:53

Five banks have come forward to evaluate Washington Mutual’s financial records as part of an auction process run by WaMu’s adviser, people familiar with the matter said on Thursday.

WaMu shares rose 14 per cent on Thursday after news it had put itself up for sale. The five banks that have looked through the WaMu materials include JPMorgan Chase, Wells Fargo, Citigroup, HSBC and Banco Santander, the people familiar said. It was unclear whether any of them intended to make an offer for WaMu. Goldman Sachs is conducting the auction for Seattle-based WaMu, which is the sixth largest US bank, with $310bn in assets...JPMorgan made an offer for WaMu this spring but was rebuffed. JPMorgan may be waiting to see whether the auction heats up before determining whether to bid for WaMu’s assets now or try to buy pieces of the bank more cheaply later, sources close to the matter said. ...If the auction does not draw interest, Goldman may have to evaluate other options for the bank. These could include raising capital by selling off the attractive assets, which would still leave WaMu holding the mortgage portfolio, or raising fresh capital to allow the bank to stand alone – a challenge in the current climate.