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Tuesday, September 23, 2008

$19 billion in mortgage loan losses for WaMu

Tuesday Sept 23, 2008
Investors turned nervous again on Monday, Sept. 22, when they pushed WaMu shares down 20%, to $3. The bank’s stocks got hit on fears that President George W. Bush's $700 billion bailout of troubled mortgage assets might not be a good thing for banks if they are forced to recognize even larger losses on their mortgage holdings.

The bank is anticipating $19 billion in mortgage losses during this crisis. Analysts say the losses could go as high as $28 billion. The uncertain company’s future continues to put a strain on the bank's customers, who are moving their deposits to other banks just to be safe. Its deposits from retail customers were down nearly $6 billion from last year by the end of June, even as the bank offered attractive rates to lure deposits.

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