Mr Cooper Group Inc (COOP)

[investorhub123]

part 3

What is a bank run?

There has yet to be a clear definition of “bank run”. While many in media (notably CNBC) damaged WaMu with reports of a 16 Billion dollar bank run, no one seems to put that statement or those numbers into context – 16 Billion of the 300 Billion deposit base is equivalent to 5%. Is 5% a bank run? Or is the term ‘bank run’ just an ill- coined and oft misused term in the media to incite fear and make stories news worthy. In addition, CNBC mistakenly reported a bank run/closure at WaMu branches that became a self-fulfilling prophecy. CNBC's mistaken reporting may have actually started the 'bank run'. At any rate, 5% or 16 Billion is small when compared to the entire removal of private and corporate deposits during the summer of 08 – by most accounts, some $550 Billion moved in the market during that time frame. Finally, while the media favored the term ‘bank run’, the regulatory organizations “FDIC/OTS” downplayed that phrase and used variations of “systemic risk” instead.


Questions we would like asked and answered:

1) Did Goldman Sachs, in any way, benefit from deals fostered by the federal regulators with respect to Barclays, Bear Stearns, Lehman Brothers or JP Morgan Chase? Was GS allowed to control or influence deals between other institutions that benefitted GS as to the removal/weakening of a competitor or that allowed GS to move/repackage toxic loans/collateral?

2) Did JP Morgan Chase, in any way, benefit from deals fostered by the federal regulators with respect to Barclays, Lehman Brothers or Washington Mutual? Was JPM allowed to control or influence deals between other institutions that benefitted JPM as a removal/weakening of a competitor or that allowed JPM to move toxic loans/collateral.

3) Did JP Morgan Chase contact any federal regulator in any way that is now looked on as suspicious or calculated with respect to the Barclays, Lehman or Washington Mutual deal?

4) How did JP Morgan Chase create a “War Room” that monitored the day-to-day cash flow of Washington Mutual – when, where and who was providing the daily (hour or minute) financial data?

5) Did Moody’s, as a credit rating agency, ever take information or entertain presentations by JP Morgan Chase with respect to Washington Mutual? If so, did Moody’s use the information/data provided by JP Morgan Chase to downgrade Washington Mutual’s status in any way?

6) With respect the FDIC and OTS, which agency is granted the authority to close banks? Follow up: What procedures are in place when the FDIC and OTS do not agree (internal discourse) on the status of a bank or thrift? Is it appropriate for the FDIC to pressure the OTS to seize the bank? To what lengths can the FDIC go to to cover its operation or force the OTS to place a bank into receivership? Is it appropriate for the FDIC to continually hound the OTS, when the OTS has publically and privately stated the institution in question if adequately funded?

7) Why was the FDIC in contact with the OTS and JPM with respect to the possible closure of Washington Mutual when the OTS and all documents collected to date showed (shows) that Washington Mutual was well capitalized?

8) Why has the FDIC and OTS refused to approve Freedom of Information Act (FOIA) requests from Kirsten Grind or Al Scott with the Puget Sound Business Journal?

9) Why has the FDIC provided completely blacked out (100% redacted) emails between the FDIC and OTS with respect to Washington Mutual? These were requested and delivered to Kirsten Grind and Al Scott on previous FOIA requests.

10) Why has the FDIC, time and time again, not followed their play-book with respect to Washington Mutual’s sale and assumption, specifically the FDIC’s ability to adjust the purchase and assumption agreement? Background: In its role as "receiver", the U.S. Congress has entrusted the FDIC with virtually complete responsibility for resolving failed federally insured depository institutions. In exercising this significant authority, governing policies and regulations require the FDIC "by statute to maximize the return on the assets of the failed bank or thrift and to minimize any loss to the insurance funds." Further guidelines direct "adjustments to the closing books may be made between the date of the closing (25 Sept 08) of the institution and the "settlement date." The settlement date may be from 180 days to 360 days after the bank or thrift closing, depending on the failed institution's size. Adjustments reflect
(1) the exercise of options by the acquirer,
(2) either any repurchase of assets by the receiver or any "put back" of assets to the receiver by the assuming institution, and
(3) the valuation of assets sold to the acquirer at market prices." (Source: FDIC Resolution Handbook).

The FDIC let this date slip without any such adjustment even when JPM’s public and SEC filings shows that it has negative goodwill due to the purchase of WaMu. In fact, the FDIC has sided with JP Morgan Chase in every respect in the court system even when the court system has labeled JP Morgan’s motions as “…frivolous”.

11) What is the generally accepted ‘financial’ definition of a bank run? Is 5% of a banks deposit base a bank run? Follow up: Does the FDIC, SEC or Fed have any responsibility to ensure that media representations are accurate – meaning should the FDIC, SEC or FED had stepped in and backed Washington Mutual on its claim that it was well capitalized? The FDIC’s mission is to insure bank deposits and prevent melt downs – wouldn’t it have been appropriate for the FDIC to publically state “Depositors of Washington Mutual – WaMu is well capitalized, there is no need to withdraw your funds and you are protected up to 100K…”

12) What communication was taking place between the SEC and the FED to prevent naked short sells (NSS) of “bank” shares?

13) Why does the SEC list on its website known NSS shares but apparently does nothing to resolve them?

14) How is it possible for a bank to be denied listing on a protection (no nss) list reserved for Systemically important institutions – then – be labeled systemically important when considering its financial connections to the market if it failed? Specifically, when all that was needed to be added to the list, to be given protection, was approval of Mr. Paulson?

15) Was Mr. Dimon in communication with other bank CEO's for the purpose of limiting bidding competition? Emails obtained through discovery show that Mr. Dimon appears to have made a side agreement with another CEO to not bid or at a minimum gave the other CEO false incentive not to bid.

http://seekingalpha.com/instablog/415296-truth-and-transparency/41647-open-letter-to-the-financial-crisis-inquiry-commission-and-permanent-subcommittee-of-investigations