Washington Mutual Case

In the year of 2008 Washington Mutual, described hereafter as WaMu, was considerably one of, if not the largest savings and loan companies in the country. At the time, WaMu was reported to have $310 billion in assets; but this did not make them vulnerable to the turbulent times brought forth by a shaky housing market. A large number of WaMu's reported assets came by way of subprime mortgage loans. After weeks of the bucket being kicked by potential buys to acquire the company, a deal had been brokered with JP Morgan Chase to take full ownership of the mega-giant of a bank for $1.9 billion. JP Morgan, a much larger competitor, would not acquire claims by equity, subordinated and senior debt holders, the FDIC said. The deal was considered a big win for then JP Morgan CEO, Jamie Dimon as Chase Bank did not have a strong footing in the west coast market as did WaMu. (Christopher, 2008). With WaMu having over 2200 branches, the purchase would make Chase the No. 1 bank in cities like New York, Chicago, Dallas, Houston, and Phoenix.

In this project we will look at the affects the buyout had on both Chase and WaMu employees and customers. We will explore the sliding scales of morale within the company and how the uncertainty of the future affected not only the service but financials of both companies. Along with this, we will take a look at the changes that took place to that lead to the decisions success or failure.

There are many facts surrounding this acquisition regarding the changes that both Washington Mutual and JP Morgan Chase underwent. These changes not only affected the individual companies as a whole, in regards to their processes, corporate structure, and employee morale, the change affected the global economy as a whole. At the time of WaMu's collapse, Kerry Killinger, the once considered wonder-boy chief executive of Seattle, amply earned the condemnation for the banks disaster. Killinger was a money manager before being hired by WaMu to be sole heir to the CEO position. This lack of banking experience provided very little check on his hubris.