NEWS-Fitch: Washington Mutual Ratings Downgraded and Withdrawn
Last update: 12:59 p.m. EDT Oct. 6, 2008
NEW YORK, Oct 06, 2008 (BUSINESS WIRE) -- Following Washington Mutual, Inc.'s (WM) filing of Chapter 11 bankruptcy, Fitch has downgraded the Issuer Default Ratings (IDR) to 'D' and removed them from Rating Watch Negative. Fitch will withdraw the ratings of WM in approximately 30 days.
In addition, Fitch has assigned recovery ratings to various WM obligations. Creditors of Washington Mutual Bank (WMB) are dependent upon the FDIC, acting as receiver, for any potential recovery. Aside from the $1.9 billion payment that the FDIC received from JPMorgan Chase for WMB's banking operations, the value of any other assets remaining in the estate remains unclear. As a result, Fitch has assigned a recovery rating of 'RR5' to the approximately $10 billion most senior obligations of the bank.
WM had cash of approximately $5 billion when the bank was closed. Those funds had been placed in deposits of Washington Mutual Bank, fsb. WM is still in the process of confirming the status of those deposit funds. Fitch has assumed that ultimately those funds will be returned to WM, although considerable uncertainty remains. Assuming these funds are returned, senior creditors could see a significant recovery. Senior debt outstanding totals approximately $4.9 billion. Fitch assigned a Recovery Rating of 'RR4' to WM's senior debt and 'RR6' to subordinated debt and preferred stock.
Washington Mutual Inc.
--Long-term IDR to 'D' from 'C';
--Short-term IDR to 'D' from 'C';
--Individual to 'F' from 'E';
--Short-term debt to 'D' from 'C';
--Senior debt to 'D/RR4' from 'C';
--Subordinated debt to 'D/RR6' from 'C';
--Preferred stock to 'D/RR6' from 'C'.
Washington Mutual Bank
--Senior debt to 'D/RR5' from 'C';
--Subordinated debt to 'D/RR6' from 'C'.
Bank United FSB
--Subordinated debt to 'D' from 'C'.
Bank United Corp.
--Subordinated debt to 'D' from 'C'.
Providian Financial Corp
--Senior debt to 'D' from 'C'.
Washington Mutual Preferred Funding (Cayman) I Ltd.
Washington Mutual Preferred Funding Trust I (Delaware)
Washington Mutual Preferred Funding Trust II
Washington Mutual Preferred Funding Trust III
Washington Mutual Preferred Funding Trust IV
--REIT Preferred to 'D' from 'C'.
Washington Mutual Capital I
Providian Capital I
--Trust Preferred to 'D' from 'C'.
The following ratings are withdrawn:
Washington Mutual Inc.
--Support (formerly at '5');
--Support Floor (formerly at 'NF').
Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site.
SOURCE: Fitch Ratings
Fitch Ratings
Sharon Haas, CFA, 212-908-0362
John Mackerey, 212-908-0366 (New York)
Media Relations:
Tyrene Frederick-Mack, 212-908-0540 (New York)
Copyright Business Wire 2008 End of Story
AI
