Mr Cooper Group Inc (COOP)

[mordicai]

Precisely. Deposits were a liability of WMB to the depositors and cash on hand was but a fraction of total deposits. See fractional reserve banking at http://www.investopedia.com/terms/f/fractionalreservebanking.asp
JPM bought the bank for 1.88 billion plus the assumption of 140 billion of net deposit liability assumption...gross of 180 billion if I recall correctly but 20 billion was cash on hand and 20 billion wa deposit with wmb fsb. One of the district court opinions spelled this out in the first paragraph of the opinion. As soon as jpm bought the bank, the fdic was off the hook to pay depositors which at the time the fdic did not have the means to do so. And jpm got the loans in return for assuming the deposit liabilities. there was a run on the bank. It is misleading to say that jpm just bought everything for 1.88 billion. If I buy an apartment building for $10,000 cash, assumption of 1,000,000 loan and $50,000 of security deposit liability, the total price I have agreed to be paid is 1,060,000 not just 10,000 cash. Deposits are a liability to the bank and asset to he customer. Bank loans out 90 per cent of deposits. Loans are assets to the bank and liabilities of other customers.