Wachovia Suitors May Delay Bidding After Dimon's Deal for WaMu
Sept. 27 (Bloomberg) -- Wachovia Corp.'s suitors may use a template honed by JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon last week: Wait to see whether regulators will seize the bank, then buy the best assets and let the government sort out the rest, according to analysts.
Citigroup Inc., Wells Fargo & Co. and Banco Santander SA are in talks with Wachovia, the Wall Street Journal reported yesterday. They're part of the same group that passed on a chance to buy Washington Mutual Inc., which the U.S. closed two days ago, leaving JPMorgan to buy WaMu for $1.9 billion, a fraction of its previous offer in March.
The bidders may try that tactic again at Charlotte, North Carolina-based Wachovia following its 27 percent plunge in New York trading yesterday, according to analysts at Goldman Sachs Group Inc. and Egan-Jones Ratings Co. They may get help from regulators, who said the U.S. benefited from seizing and selling WaMu because the Federal Deposit Insurance Corp. didn't have to tap its $45 billion insurance fund.
"WaMu's takeover has proven that there's an easy way, if the FDIC is involved," said Sean Egan, president of Egan-Jones in Haverford, Pennsylvania. "You kick the hell out of the equity holders and bondholders. That may be the new model for bank takeovers."
Emphasis added by me.
"Equity holders" -- the shareholders these bastards hide behind at their own companies to justify their crimes.
And then when they've gorged and gorged and gorged, they become Too Big To Fail and we have to bail out these financial sociopaths.