Washington Mutual Files Amended Reorganization Plan After FDIC Settlement
Washington Mutual Inc. said its revised reorganization plan calls for $7 billion in creditor distributions and incorporates an amended settlement with the Federal Deposit Insurance Corp. and JPMorgan Chase & Co.
The parties agreed to modify an earlier settlement to address changes that have occurred since it was reached, including the appointment of an examiner and an agreement with some of the company’s creditors, Seattle-based Washington Mutual said yesterday in a statement distributed by PRNewswire.
A hearing on approval of the disclosure statement that was filed with the amended reorganization plan is scheduled for Oct. 18 in U.S. Bankruptcy Court in Wilmington, Delaware, according to the statement.
U.S. Bankruptcy Judge Mary F. Walrath in July agreed that an examiner should be appointed to review WaMu’s assets, including the value of potential lawsuits against JPMorgan Chase and the FDIC over their role in the 2008 collapse of Washington Mutual Bank.
Shareholders claim that lawsuits related to the bank’s failure might bring in $30 billion, a figure disputed by the FDIC, WaMu and its creditors.
WaMu filed for bankruptcy Sept. 26, 2008, the day after its banking unit was taken over by regulators and sold to JPMorgan for $1.9 billion. Before it failed, Washington Mutual Bank had more than 2,200 branches and $188 billion in deposits.
The case is In Re Washington Mutual Inc., 08-12229, U.S. Bankruptcy Court, District of Delaware (Wilmington).
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