Jamie Dimon had some choice words for Washington Mutual chief Kerry Killinger on JPMorgan’s earnings call today. In short: JD, never one to mince words, disputed Killinger’s assertion at yesterday’s Congressional hearings that a special club of Wall Street execs got bailed out while WaMu got shafted.
“I am unaware of any club,” Dimon said on the call. Michael Cavanagh, JPMorgan’s CFO said the bank was the only bidder for WaMu. Yesterday, Killinger said he was treated unfairly when regulators seized his company and sold it a “bargain” price to Jamie & Co.
“Look you got to ask the regulators, we had nothing to do with the decisions that were made around declaring them insolvent and stuff like that," Dimon said on the call. "Obviously they were having deposit outflow. As you remember when we bought the company we put up $40 billion reserves for writedowns and various assets."
Killinger said yesterday that deposits at WaMu were stable, the bank had more than enough capital and had not been asked by regulators to raise more cash. Still, WaMu had hired Goldman Sachs to help it find more capital or a merger partner, but those efforts were stymied by a parallel auction being conducted by the FDIC.
Killinger maintains WaMu would have made it through the financial crisis had regulators not seized it prematurely.
When asked whether WaMu would have failed if the government had not declared the bank insolvent, Dimon said deposits were flying out the door and co
nditions in mortgage market “just got worse” in the months after it collapsed.