READING LIBRARY
Washington Mutual: a bank failure, a deposit transfer
What happened on September 25, 2008.
A historic failure
Washington Mutual failed on September 25, 2008. The FDIC became receiver. With approximately $307 billion in assets, it was the largest failure of an insured depository institution in FDIC history.
What happened to the deposits?
In a transaction facilitated by the FDIC, JPMorgan Chase acquired Washington Mutual's banking operations and assumed all deposits, approximately $188 billion. The failure did not mean that depositors' balances simply disappeared.
Why the distinction matters
The outcome for a depositor can differ from the outcome for an investor in a bank's stock or debt. A bank's closure, the transfer of its customer accounts, and losses suffered by its investors are separate issues.
Read the official FDIC account below for the transaction details. This historical example is context, not a prediction of what will happen at any particular institution today.