Mr Cooper Group Inc (COOP)

[Dmdmd2020]

Per the documents used during the 2010 Congressional Subcommittee hearing:

https://www.hsgac.senate.gov//imo/media/doc/Financial_Crisis/FN107-1342.pdf?attempt=2

PDF pages 264-301 of 1037:

WaMu Timeline details the OTS/FDIC/FRB/FHLB-SF actions from January 05, 2000 to September 26, 2008.

WaMu Timeline was prepared by OTS Examiner-in-Charge Benjamin Franklin.


There’s plenty of good information laid out in chronological order which shows that despite the bank run in the summer of 2008, WMB and WMB,fsb were still able to weather the storm.

But I didn’t start this thread to re-litigate the solvency of WMB and WMB,fsb.

I just want to highlight September 23, 2008 to September 26, 2008.

PDF page 300-301:

“9/23/08 Daily Liquidity report provided to WR and DC senior management.
FDIC requested that OTS directs the Bank to only borrow short term advances to avoid prepayment
penalties; which we communicated.
WMI ROE Uploaded to OTS System.
WMB Treasury personnel respond that the Bank has potential saleable assets, but none that can be sold in short order. Assets potentially include loans, CMBS, corporate and municipal bonds, as well as REIT asset currently in a Special Purpose Entity that could be dissolved under certain Supervisory actions. Latest FRB projection indicates that WaMu liquidity would reach "0" by 10/9/08 assuming approximately $2.0 billion runoff per day.
WaMu projects available liquidity at $23.6 billion
Notified WMI via hand carried letter that the holding company rating was downgraded to "4", which
differed from the ROE's "3"rating, based on WMI's condition at 6/30/08. Downgraded WMBfsb to "4" based on condition of parent.


9/24/08 Daily Liquidity report provided to WR and DC senior management.
FDIC reports to OTS that while deposit outflows are declining they are not stabilized and that FHLB-SF is "day to day" with respect to future advances.
S&P Lowers Washington Mutual Inc's ratings to "B-" from "BB-"; S&P affirms the "BBB-/A-3" rating on Washington Mutual Bank as the breadth of the deposit franchise, the capital position and loss reserve coverage remain adequate in light of the high level of mortgage loan asset quality pressures. WaMu submits a presentation on potential recapitalizations options.
FDIC informs JP Morgan that they had won the bid for WaMu


9/25/08 Daily Liquidity report provided to WR and DC senior management. Available liquidity projected at
$13.1 billion (subject to FHLB continuing to fund).
Total deposit outflow (including commercial) from 9/8/08 to 9/24/08 is $18.7 billion.
Net consumer noninterest and small business outflows from 7/14/08 to 9/25/08 total $19 billion.
The FHLB of San Francisco notifies WaMu that it is near its limit on advances. WaMu believed that they had another $5 billion in capacity.

The FRB of San Francisco moves the bank into the secondary credit category.
FHLB-SF limits WMB advance availability to $500.0 million.
OTS directs WaMu to dissolve the WM preferred Funding REIT.
At FDIC's Request, OTS examiners directed I management to dissolve Preferred Funding REIT (a special purpose entity), forfeit all rights to the approximately $9.0 in loan collateral, and assign the collateral loans to WMB for inclusion in the receivership transaction.
WaMu placed into receivership; sold to JP Morgan Chase.
JP Morgan raises $7.0 billion from private investors pursuant to the WaMu purchase.
FDIC asks if OTS found any violations of law in connection with the Appraisal Investigation. Examiners referred them to West Region Counsel Jim Hendriksen.


9/26/08 JP Morgan raised an additional $3.5 billon in the open market or $2.5 billion more than planned, related to the WaMu deal. Its stock increased 6.8 percent from 9/24/08 price of $40.50.
FDIC asks if OTS removed the Board Audit and Finance Committee notebooks from the examiner library and were informed that we had not. It was determined that Regulatory Relations staff had removed them the evening of 9/25/08. They were returned upon our request.”

________________________

IMO...my conclusions as of November 05, 2018:

1) JPMC was notified that they had won the bid for WAMU on September 24, 2008.

2) per the SEC press release, JPMC paid $1.9 billion :

Per the SEC press release :

https://www.sec.gov/Archives/edgar/data/19617/000119312508201636/dfwp.htm

Excerpt starting on the bottom of page 1-2;

“New York, Sept. 25, 2008 – JPMorgan Chase & Co. (NYSE: JPM) tonight announced it has acquired all deposits, assets and certain liabilities of Washington Mutual’s banking operations from the Federal Deposit Insurance Corporation (FDIC), effective immediately. Excluded from the transaction are the senior unsecured debt, subordinated debt, and preferred stock of Washington Mutual’s banks. JPMorgan Chase will not be acquiring any assets or liabilities of the banks’ parent holding company (WM) or the holding company’s non-bank subsidiaries. As part of this transaction, JPMorgan Chase will make a payment of approximately $1.9 billion to the FDIC.“

3) per the WAMU Timeline above:

As of September 25, 2018, JPMC raised $7.0 billion from private investors to purchase WaMu.

As of September 26, 2018, JPMC raised an additional $3.5 billion related to Wamu deal.

IMO... calculations:

JPMC raised $10.5 billion for WaMu deal...but have only paid $1.9 billion.

Draw your own conclusions...but either JPMC lied to their investors/shareholders and hoarding the remaining cash which was allocated for the Wamu deal or the documents from the SEC, FDIC/OTS, Congressional Subcommittee hearing is inaccurate.

IMO...I believe there will be more payment from JPMC regarding the WAMU deal.