Wachovia faced a 'silent' bank run; FDIC forced sale
Charlotte-based Wachovia Corp. is selling its retail bank, wealth management unit and corporate and investment bank to Citigroup.
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#1 Oct 4, 2008
Wachovia Corp announced Monday that the company's banking operations were being bought by Citigroup, in a middle of the night deal brokered by the FDIC. Treasury Secretary Henry Paulson said in a statement that the sale of Wachovia's banking operations to Citigroup would "mitigate potential market disruptions." Paulson said he agreed with the FDIC and the Fed that a "failure of Wachovia would have posed a systemic risk" to the nation's financial system. Treasury Secretery Paulson continued; saying, that with more than $800 billion in total assets, a Wachovia collapse would have dwarfed the demise of Washington Mutual.
With the House of Representatives vote on a $700 billion economic bailout package just hours away, Wells officials walked away from Wachovia negotiations and Citi stepped up with a rescue plan that was brokered by the fed just hours before the bank was seized by the FDIC. This 11th hour sale to Citi was intended to protect depositors and stablize a crumbling bank. With clarity that comes with a couple of extra days and passage of the bailout bill by the senate, Well Fargo exec's had a "financial" change of heart and contacted Wachovia CEO Bob Steel with a sweet deal that would reward Steel, Wachovia directors and executives who had purchased millions of Wachovia shares in the weeks prior to the banks failure.
Violating the terms of the Citi agreement and negotiating with Wells Fargo, the Wachovia insiders should not be rewarded with millions in profits at the expense of Citi shareholders and the american taxpayor once again.
With the FBI investigating Fannie, Freddie and Lehman, Wells Fargo and Wachovia officials should start erasing emails and cell phone records as soon as humanly possible because you're next.
#2 Feb 24, 2009
This was one of the most heavily reported http://www.bankrun.us bank runs at this location.
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