Wachovia (WB): Being In Banking Gets Worse
October 22, 2008 by Douglas A. McIntyre
It is a good thing Wachovia (WB) will not have to go it alone. It would not make it.
Wachovia reported a net loss in the third quarter of 2008 of $23.89 billion, representing a net loss per share of $11.18, including a provision for credit losses of $6.63 billion to cover $1.87 billion in net charge-offs and to build reserves by $4.76 billion.
The third quarter 2008 net loss compared with earnings of $1.62 billion or 85 cents per share in the third quarter of 2007
The $18.8 billion in noncash goodwill impairment reflecting declining market valuations and the terms of the merger with Wells Fargo (WFC); the recognition of the impairment affected the retail and small business, commercial, wealth management and asset management subsegments.
Wachovia’s general bank which includes retail, small business and commercial customers, is the only unit which did well. It has segment earnings of $857 million down from $1.5 billion a year ago. But, at least it did not lose money
Douglas A. McIntyre
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