http://www.bloomberg.com/apps/news?pid=20601110&sid=a3479q5QfJhwWaMu Slumps as Gimme Credit Cites Liquidity Concern (Update2)
By Ari Levy
July 24 (Bloomberg) -- Washington Mutual Inc. tumbled for a second day in New York trading after Gimme Credit LLC said unsecured creditors were ``pulling funds'' from the biggest U.S. savings and loan. Washington Mutual disputed the report.
Gimme Credit analyst Kathleen Shanley cited a decline in federal funds purchased and commercial paper to $75 million from $2 billion at year-end, which Washington Mutual reported this week in its second-quarter results. Securities sold under agreements to repurchase dropped to $214 million from $4.1 billion at the end of 2007, she wrote.
Washington Mutual, known as WaMu, reported a $3.3 billion second-quarter loss on July 23. Rising delinquencies forced the Seattle-based company to boost provisions for bad loans. While WaMu said it has enough capital after raising more than $7 billion earlier this year, Shanley said liquidity remains a concern.
``We won't use the phrase `run on the bank,' but we would be remiss if we did not observe that many creditors have quietly been pulling funds,'' wrote Shanley, based in Chicago. Their actions are ``presenting an increasing funding challenge,'' she wrote. Gimme Credit is an independent research firm serving corporate bond investors.
Which, naturally, happens to be my own bank.
I'm pulling funds too but maybe not fast enough...
Monday I'm calling a bank rating agency to pull a report on Wamu and potential replacements.
