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We Don't Want To Be Accused Of Yelling 'Fire' In A Bank Lobby But...FIRE!

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Hilariously named research firm "Gimme Credit" doesn't want to go the way of Bove, or any of the perps Jamie Dimon's got his eye on, but felt that it could not in good conscience not let you know that a loss of liquidity could spell trubs for Washington Mutal. Sayeth GC:

We do not want to be accused of screaming "fire!" in a bank lobby, as John Reich, the director of the OTS (WaMu's primary regulator), said recently. 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 from the bank. For example, Fed Funds purchased and commercial paper declined $75 million at 6/30/08, down $2.0 billion at year-end and $3.4 billion a year ago. Securities sold under agreements to repurchase are down to $214 million, from $4.1 billion and $9.4 billion for the year-end and prior-year, respectively. Other borrowings are $30.6 billion, versus $39.0 billion in December. With unsecured creditors taking a giant step backwards, the combined percentage of the balance sheet funded by deposits and the Federal Home Loan Banks has increased to 78% up from 75% at year-end and 71% a year ago. Small wonder Mr. Reich is feeling testy.


Bank Of America Hoping To Fire Thousands Of Employees In Record Time

Remember Project New BAC, i.e. Bank of America's plan to transform itself from Ken Lewis's house of fun, where everyone went home happy but the concept of making money was less of a focus than keeping the good times coming, to an institution that did things like post profits? The bank has said previously that PNBAC "will result in $8 billion in annual savings by 2015—$5 billion from the first phase and $3 billion from a second phase" and while it stands by those figures and remains committed to cutting as many employees as it takes, some people would like them to be a bit snappier about it. Bank of America is accelerating a broad cost-cutting plan and has set a target of shedding 16,000 jobs by year's end—cuts that would see the company relinquish its title as U.S. banking's largest employer. The proposed year-end total of 260,000 would be the lowest count since 2008 and likely give Bank of America a smaller workforce than JPMorgan Chase, Citigroup, or Wells Fargo...Chief Executive Brian Moynihan is trying to speed the company's transformation into a smaller and more efficient operation as he tries to persuade investors that expenses can be adjusted to compensate for revenue lost to new regulations, an uneven economy and shaky markets. Since becoming CEO in 2010, he has shifted away from a nationwide expansion strategy embraced by his predecessors Hugh L. McColl Jr. and Kenneth D. Lewis, and shed many of the businesses that he considers to be nonessential...Hitting the new staffing target would fulfill a year early Mr. Moynihan's pledge to slash the bank's workforce by approximately 30,000. "If they want to make any headway toward improving profitability," said Sterne Agee & Leach Inc. senior banking analyst Todd Hagerman, "they need to accelerate the timeline." Bank Of America Ramps Up Job Cuts [WSJ]