March 19 (Reuters) - Washington Mutual Inc, one of the
biggest corporate casualties of the 2008 financial crisis, on
Monday emerged from bankruptcy protection, just two weeks after
Lehman Brothers Holdings Inc also emerged from Chapter 11.
The Seattle-based company, the largest U.S. bank or thrift
to fail, said it plans to begin repaying about $7 billion to
creditors. Many of these are hedge fund investors specializing
in buying securities of bankrupt companies.
Washington Mutual's emergence from Chapter 11 ends nearly
3-1/2 years of court battles that saw the company propose seven
U.S. Bankruptcy Judge Mary Walrath in Delaware officially
approved the seventh plan on Feb. 23, court records show.
The reorganized company is known as WMI Holdings Corp. It
includes a small mortgage reinsurance business, WMI Mortgage
Reinsurance Co, owned by former preferred and common
shareholders. Washington Mutual's existing common stock has been
With about $307 billion of assets, Washington Mutual failed
on Sept. 25, 2008, 10 days after Lehman went bankrupt,
succumbing to a run on deposits and losses on tens of billions
of dollars of risky mortgages and home equity loans.
JPMorgan Chase & Co immediately bought Washington Mutual's
banking operations in a $1.88 billion transaction arranged by
the FDIC. Washington Mutual's holding company filed for
protection from creditors on Sept. 26, 2008.
Weil, Gotshal & Manges represented Washington Mutual in the
The case is In re: Washington Mutual Inc, U.S. Bankruptcy
Court, District of Delaware, No. 08-12229.
For WaMu: Amanda Steele of Richards, Layton and Finger.
(Reporting by Jonathan Stempel)
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