Wachovia Posts Largest-Ever Loss for a Bank

[Purveyor]

Source: Washington Post

Washington Post Staff Writer
Wednesday, October 22, 2008; 2:53 PM

Wachovia posted a $23.9 billion quarterly loss, as its portfolio of loans deteriorated and deposits fled the bank, laying bare the serious financial straits the company was in before Wells Fargo announced it would buy it this month.

The loss is the largest ever for a bank and, coming on top of $10 billion of losses earlier this year, wipes out nearly all the profits the firm has earned since the merger of two banks formed modern Wachovia in 2001.

The quarterly report revealed that Wachovia was experiencing a run in September as speculation about whether the bank would survive the financial crisis intensified. Depositors pulled out 5 percent of their money, or $13.4 billion, a massive amount for a bank.

--snip
Most of Wachovia's loss -- $18.8 billion -- stems from writing down the value of its reputation, brand and experience, an intangible measure known as "goodwill" that mainly plays a role in setting a company's value in mergers and acquisitions. The company lost $2.5 billion on its portfolio of loans and put away billions more to cover expected future losses.

Last year at the same time, the company posted a $1.7 billion profit. Wachovia shares have lost nearly 90 percent of their value in the past year.

Read more: http://www.washingtonpost.com/wp-dyn/content/article/2008/10/22/AR2008102201873.html

[Faygo Kid]

1. Market is in freefall

[Nambe]

2. Another big bonus coming for breaking a record.

[madrchsod]

3. they lost 18 million doillars in "intangibles"......

i wonder who started the run on the bank.....