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BOB this fantasy being promoted that the bankruptcy process is 100% isolated from Safe Harbor is ludicrous. As I have stated before, had POR 6 been successful and Equity was cancelled outright, right there is how the bankruptcy could impact Safe Harbor assets. The same goes if Commons only were cancelled, Prefs only would have owned the Estate.
The owners of WMIH, AAOC or Prefs respectively, would have gained all estate assets with Commons and/or Prefs receiving nothing. We are 100% certain old equity was cancelled, how they could somehow be magically resurrected to reclaim the estate is not based in reality. 75%/25% is what now applies, no matter how terribly some would like otherwise.
WAMU DS pgs 162-164 of 269...........
FACTS don't support foolish theories about who now owns the WMI Estate. It surely isn't Commons only as is being purported. All presented is basic English that any competent person could understand.
a. Cancellation of REIT Series
Notwithstanding the provisions of Section 23.1 of the Seventh Amended Plan, on the Effective Date, all REIT Series shall be deemed extinguished and the certificates and all other documents representing such Equity Interests shall be deemed cancelled and of no force and effect. For the avoidance of doubt, Section 23.2 of the Seventh Amended Plan shall have no effect on, and shall not result in the extinguishment or cancellation of, the Trust Preferred Securities and, in accordance with the Global Settlement Agreement, JPMC or its designee is the sole legal, equitable and beneficial owner of the Trust Preferred Securities for all purposes.
b. Cancellation of Preferred Equity Interests
Notwithstanding the provisions of Section 23.1 of the Seventh Amended Plan, on the Effective Date, all non-REIT Series Preferred Equity Interests shall be deemed extinguished and the
certificates and all other documents representing such Equity Interests shall be deemed cancelled and of no force and effect.
a. Cancellation of Common Equity Interests
Notwithstanding the provisions of the Seventh Amended Plan, on the Effective Date, all Common Equity Interests shall be deemed extinguished and the certificates and all other documents representing such Equity Interests shall be deemed cancelled and of no force and effect.
Those SPE's like WMMSC etc were I believe direct subs of WMB, and indirect subs of WMI but whose assets could not be seized. IMO we will receive the benefits or part thereof from what beneficial interests WMI held in those assets. WMI did not own the entire pool of assets but rather may have retained some percentage while selling the rest to 3rd party investors,
The owners would be the investors in those securities and WMMSC if they retained any participating interests. The question is whether WMI had some official agreement with WMMSC to forward the resulting cash or part thereof to the parent and if it is still binding.
That may be so but it doesn't change the fact that an official report on FDIC Receiverships stated that "Whole Bank" sales are on average resolved in an 8-10 year period. WAMU being this large and complex may indeed take longer but 20 years is quite a stretch.
QUOTE: "then there is this footnote that said basically JPM bought the bank, which includes the assets that backed the mortgage, but not the mortgage interest itself, and therefore it cannot be held liable."
The footnote doesn't actually say that JPM bought the assets that backed the mortgages but rather that they acquired WMB's banking operations, and accordingly the "operations" of it's SPE subs that securitized assets (WMMSC, WMAAC etc).
QUOTE: "Assets are reported herein in accordance with Rule 15Ga-1 regardless of the validity of the demand or defenses thereto, and nothing in this report shall constitute, or be deemed, a waiver of any rights, defenses, powers or privileges of any party relating to these assets."
Any MBS's (and the assets backing them) issued and/or owned by WMMSC and other SPE's that were WMB subs, could not be sold to JPM as per Safe Harbor rules. This is the reason why, IMO, JPM stated that the repurchase obligations remained with the FDIC. They never bought any of those assets and as such they are not responsible for the terms of those agreements. Repurchase obligations are binding contracts between the purchasers and the issuer/owner of those MBS's as a type of guarantee on the investment. By denying any liability for these assets it is clear that JPM is most likely just servicing them on behalf of the FDIC.
The point I was making was that people keep quoting that WAMU had $300B in assets while omitting the associated liabilities.
I wasn't indicating that WMI literally had $29B in assets left over but was just using those numbers as a reference.
When the FDIC moves to close out the Receivership, of which this type (Whole Bank) takes on average 8-10 years.
September 26th this year marks the 10 year anniversary of the WMB Receivership.
I do believe JPM bought WMB but definitely NOT any of the assets of it's SPE subs such as WMAAC or WMMSC etc.
Those assets when liquidated will IMO will be more than sufficient to clear all Receivership claims (~$16.2B) with a sizeable amount left over for Equity.
Those assets are currently being serviced by JPM until that time when they may be liquidated or reach maturity.
The loans referred to in Exhibit Z are not the loans in question, these were about 300 loans held by WMI's direct sub Ahmanson.
I'm not entirely sure about the value of these loans but I do not believe their total worth is in the $Billions.
Been looking intensely at this FDIC angle since you recently posted the FDIC Inception Balance Sheet.
This theory may very well turn out to be incorrect but up to this point I honestly don't see how it can be!
Can't seem to elicit any critical responses from the ""opposition"" on this issue either, which is rather odd.
Changes to the Safe Harbor rule would not affect any of WAMU's assets since they were all securitized prior to the changes taking effect in early 2010.
There was a Grandfather Clause which shielded all assets from being affected by the new rules, and would only apply to assets securitized after it's official adoption.
I'm relatively confident many of WAMU's assets were protected by Safe Harbor from sale to JPM but what is still unclear is whether WMI held and still hold beneficial interests in those assets.
That may very well be but at this point the FDIC has not indicated that the base amount even exists since 2009. At some point we will get an answer....hopefully sooner than later!
Comments???
The WMB Notes totaling $13.8B that are currently Receivership claims with the FDIC were backed by an assigned loan pool. This pool was overcollateralized to the tune of 13.4% or ~$1.85B.
If the FDIC did as the P&AA stated they could, these loan pools were not sold to JPM since they were the supporting assets for those Note claims.
If that is the case then the - $40.2B Asset related Equity Adjustment is actually an positive asset of + $40.2B.
The FDIC has already called $26.4B of that amount an Unrecorded or Discovered Asset and the remaining $13.8B a liability. If the assets backing the $13.8B was indeed retained, then that claim liability potentially becomes a $13.8B asset.
This could mean that once those mortgage assets can be liquidated to clear that Note debt, the FDIC will remain with ~$26B in assets for Equity and DB's $2.4B debt.
Link in post 520224
Realization of Cover Pool assets following the occurrence of a Mortgage Bond Acceleration
Following the occurrence of a Mortgage Bond Acceleration, the Mortgage Bond Indenture Trustee will enforce its rights against the Cover Pool which secure the Mortgage Bonds. Any collections or proceeds of liquidation or other enforcement in respect of the Cover Pool after a Mortgage Bond Acceleration will be paid to the Issuer (or the Covered Bond Indenture Trustee on its behalf), allocated on a pro rata basis according to the outstanding principal balance of each series of Mortgage Bonds and invested in the Specified Instrument(s) designated in respect of the related Series of Covered Bonds. There is no guarantee that such collections or proceeds (and therefore any amounts received in respect of the related Specified Instrument(s) and payments under the related Covered Bond Swaps) will be sufficient to repay interest and principal on the related Series of Covered Bonds.
The WMI issued Preferred, WamPQ and WamKQ were NEVER directly backed by any mortgages or issuances like the TPS or WMB Bonds.
That was made extremely clear in their respective Prospectus's and is not IMO, but rather an unrefutable fact.
I'm out for the day....GO LIVERPOOL!!!!!!
From WAMU DS....pg 182 of 269
4. Cancellation of Existing Securities and Agreements
Except as provided in the Seventh Amended Plan, any document, agreement, or instrument evidencing any Claim or Equity Interest shall be deemed automatically cancelled and terminated on the Effective Date without further act or action under any applicable agreement, law, regulation, order, or rule and any and all obligations or liabilities of the Debtors under such documents, agreements, or instruments evidencing such Claims and Equity Interests shall be discharged;
Just one tidbit of info I forgot to mention, the mortgage pool covering the bonds were all AAA rated, so they most likely did not consist of high risk assets.
The WMB Notes totaling $13.8B that are currently Receivership claims with the FDIC were backed by an assigned loan pool. This pool was overcollateralized to the tune of 13.4% or ~$1.85B.
If the FDIC did as the P&AA stated they could, these loan pools were not sold to JPM since they were the supporting assets for those Note claims.
If that is the case then the - $40.2B Asset related Equity Adjustment is actually an positive asset of + $40.2B.
The FDIC has already called $26.4B of that amount an Unrecorded or Discovered Asset and the remaining $13.8B a liability. If the assets backing the $13.8B was indeed retained, then that claim liability potentially becomes a $13.8B asset.
This could mean that once those mortgage assets can be liquidated to clear that Note debt, the FDIC will remain with ~$26B in assets for Equity and DB's $2.4B debt.
AIMHO
WMB Note Program
Realization of Cover Pool assets following the occurrence of a Mortgage Bond Acceleration
Following the occurrence of a Mortgage Bond Acceleration, the Mortgage Bond Indenture Trustee will enforce its rights against the Cover Pool which secure the Mortgage Bonds. Any collections or proceeds of liquidation or other enforcement in respect of the Cover Pool after a Mortgage Bond Acceleration will be paid to the Issuer (or the Covered Bond Indenture Trustee on its behalf), allocated on a pro rata basis according to the outstanding principal balance of each series of Mortgage Bonds and invested in the Specified Instrument(s) designated in respect of the related Series of Covered Bonds. There is no guarantee that such collections or proceeds (and therefore any amounts received in respect of the related Specified Instrument(s) and payments under the related Covered Bond Swaps) will be sufficient to repay interest and principal on the related Series of Covered Bonds.
JPM may have assumed the duties of operating certain WMB subs but in terms of the property they held/owned. They could not assume those "Successor in Interest" rights since IMO these subs were SPE's. That being the case those assets owned by these SPE's could not be legally sold to JPM. The function performed here by JPM would be in a custodial capacity.
Successor in Interest Law and Legal Definition. The term successor in interest means a successor to another's interest in property, especially a successor in ownership of a business that is carried on and controlled substantially as it was before the transfer.
The FDIC does not still hold $299B in assets from WMB, that is a gross misrepresentation of the facts. Upon seizure of WMB, JPM acquired $258B of those assets in the purchase. This is not my opinion but rather the facts laid out by the FDIC in a 2008 document. Post 518718 clearly refutes this inane claim with actual proof.
They were direct subs of WMB but WMAAC and WMCC were SPE's, if my memory serves. Any assets they held could not be seized since they would fall under Safe Harbor protection. Not sure about Long Beach though.
See post 518718.............
The FDIC became the Receiver for WMB assets to the tune of $299B and of those assets JPM acquired $258B of those assets in the purchase. The FDIC retained $40B+ in assets, not all $299B, the official FDIC documents don't lie.
This is what I don't get when these ridiculous sums are quoted. Along with assets there are liabilities which must be paid. That $299B was accompanied with about $270B in liabilities. Once paid the actual amount available would be only $29B, not $299B. This is basic math!
Everything wasn't sold to JPM, that is evident by the $27B Discovered Asset the FDIC referenced in their 2009 document.
The P&AA clearly stipulated that the FDIC was allowed to retain assets tied to Receivership claims.
Whether there are any additional Safe Harbor assets owned by the WMI estate is still unclear and unproven.
The $1.9B payment is all that the FDIC will receive for the assets sold IMO, but I could be wrong.
Successor in interest to only what was sold to them by the FDIC, not what was retained for the benefit of the Receivership IMO.
I just translated it before. Other than that who knows exactly what they meant.
Please go back and read the whole thread with fwh. I was speaking about WAMU's 300B in assets and he responded about JPM shedding $165B. WMI never had $165B worth of assets, but the WMB receivership does. If not WMB but rather it's JPM assets they shed, not our business. You are obviously confused about the thread topic.
See post 518718 by justice. The FDIC stated it in their own document. Pay special attention to Note 8 and link it back to the financial info. I eagerly await to be proven wrong!
IMO WMIH was only mentioned because they still had fulfillments under the POR to perform eg the run-off payments to the LT. Not seeing anything further than that.
Why would anyone believe that assets shed by JPM would ever be ours unless the inference was they were WMB assets. If WMB was never mentioned why then is JPM shedding their own assets even being discussed? (re fwh's original response)
IN my own words........
Subject to certain exonerating provisions, released claims do not include Preference Actions, fraudulent transfers or claim objections regarding the WMI entities, WMB, WMI/WMIIC and WMIH.
IMO yes, this has nothing to do with any S4V.
Preference Action: A preference action is an action brought by the Trustee of a bankruptcy estate (or a debtor in possession) to recover payments made by the debtor to a creditor prior to the filing of the bankruptcy petition....WMI loans to WMB maybe prior to bankruptcy?????
Bit of a stretch but...............
Provide a link showing where JPM, the greediest bank in the US, gave away cash and assets to meet new FDIC regulations. Until then i still contend those were non performing deposits they shed. If they were indeed cash/assets and it didn't belong to WMB how does that benefit us in any way???
Where was it stated that the $165B was comprised of only WMB ??assets/deposits?? acquired from the FDIC. If it was indeed deposits, that in no way benefits us since deposits are customer owned ie a liability.
Kinda explains what the FDIC MUST do eventually..................
1.183 Released Claims:......provided, however, that “Released Claims” does not include (1) any and all claims that the JPMC Entities, the Receivership, the FDIC Receiver and the FDIC Corporate are entitled to assert against each other or any other defenses thereto pursuant to the Purchase and Assumption Agreement, which claims and defenses shall continue to be governed by the Purchase and Assumption Agreement, (2) any and all claims held by Entities against WMB, the Receivership and the FDIC Receiver solely with respect to the Receivership, and (3) subject to the exculpation provisions set forth in the Plan, any avoidance action or claim objection regarding an Excluded Party or the WMI Entities, WMB, each of the Debtors’ estates, the Reorganized Debtors and their respective Related Persons; and, provided, further, that “Released Claims” is not intended to release, nor shall it have the effect of releasing, any party from the performance of its obligations in accordance with the Confirmation Order or the Plan.
Yes true, wholly owned WMB assets have gone to JPM, but not any Safe Harbored MBS's owned by it's subs.
Definitely not the $40B+ in "assets/liabilities" that the FDIC did not transfer to JPM.
~$27B of which the FDIC just happened to refer to as an Unrecorded or Discovered Assets!
I never make predictions, but based on the evidence, I'm very confident the latter (Discovered Assets) is accurate.
I've always been suspicious of why the Debtors caved so easily to the FDIC and JPM in terms of ownership of WAMU assets.
I believe the case was they knew WMI had substantial interests in MBS's owned by it's subs and that they were protected from seizure.
Had POR V6 been approved with WMIH being 100% owned by AAOC, IMO this case would have long wrapped up already.
WMIH would then have been able to legally reclaim those Safe Harbor assets, a'la the K-Mart scenario.
This did not occur and POR V7 was instead passed, for the ultimate benefit Equity holders.
This is why I believe there is such a great delay in resolving frivolous matters such as the Employee Claims.
The LT already has the cash set aside for payment, at no cost to the FDIC, therefore IMO this is nothing but a stalling tactic.
On this issue we shall see but I agree, WMIH is poised to be a great investment for many here!!!
IMHO those figures are not even close to being realistic. To date i believe only ~$27B in assets held by the FDIC can be proven.
After Note claims and DB are paid in full that leaves ~$11B in returns to Equity, IF i'm correct to be divided 75%/25%.
This return would give Commons a return of ~$2.29/sh. Not stating there isn't more but this amount is supported by actual evidence.
Where there are assets there must be liabilities. WAMU held $300B+ in assets but also $270B+ in liabilities, therefore making those assets not worth anything close to $300B once liabilities are paid.
For example, if the underlying loans of MBS's were funded by bank deposits, those deposit liabilities must be repaid. The actual value of the asset comes from the interest payments only, not the total asset.
If the loans were funded using company profits then the opposite would apply since both the principle and interest payments would be credited to the company. Here $30B in loan assets have an actual value of ~$30B since there are no funding liabilities.
Nice post Dm. I may not agree with your numbers in regards to the valuation of assets, but thanks for providing some substance in making your compelling case.
Yes you are 100% correct on that. The ones shouting APR have not read how APR can be easily discarded once all impaired Creditors consent to the plan. This is exactly why POR 7 passed, because the plan was consensual. APR is long gone, the POR now guides how we progress.
QUOTE: "In accordance with the Plan, the Trust will issue Liquidating Trust Interests to WMI’s former shareholders if, and only if, the Trust is able to monetize Liquidating Trust Assets in amounts sufficient to pay-in-full claims held by beneficiaries of the Trust who are senior to members of Classes 19 and 22, and then, only if a shareholder had satisfied timely all conditions applicable to receiving any such Liquidating Trust Interests.
To put it in a nutshell, No release,...No compensation!!!