Washington Mutual
Former American savings and loan institution whose banking subsidiary was seized and sold to JPMorgan Chase during the 2008 financial crisis.
Last updated August 31, 2026
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Overview
Washington Mutual, commonly known as WaMu, was an American savings and loan institution and financial-services holding company headquartered in Seattle. Its origins date to 1889, when it was formed as the Washington National Building Loan and Investment Association after the Great Seattle Fire. The organization made an early home-mortgage loan on the West Coast in 1890 and developed from a local mutual savings institution into one of the largest retail banking groups in the United States. For much of its history, Washington Mutual concentrated on household financial services, including savings and checking accounts, residential mortgages, home-equity lending, credit cards, and consumer banking. It expanded principally through branch acquisitions and the purchase of other financial institutions across Washington, Oregon, California, and additional states. Important transactions included the acquisition of Murphey Favre, the expansion of its mortgage platform through PNC Mortgage, Fleet Mortgage, and Homeside Lending, the purchase of Providian Financial in 2005, and the acquisition of regional banks and failed thrifts during the restructuring of the American savings-and-loan sector. The company ceased to be a mutual institution in 1983, when it demutualized and became a publicly traded capital-stock savings bank. In 1994, it reorganized as Washington Mutual, Inc., a holding company separating the parent organization from Washington Mutual Bank. The brand increasingly presented itself as a mass-market, relationship-oriented consumer bank, using the long-running slogan “The Friend of the Family.” In 2006, it moved into the WaMu Center in downtown Seattle and began using “WaMu” as its official abbreviation in most non-legal contexts. The institution grew rapidly during the housing and credit boom. By June 30, 2008, its banking operations had 2,239 retail branches in 15 states, 4,932 automated teller machines, and 43,198 employees. Its business included a large residential-mortgage portfolio, option adjustable-rate mortgages, subprime loans, home-equity lines, credit cards, and mortgage servicing for itself and other lenders. This exposure left the group vulnerable as housing prices declined and mortgage delinquencies rose. Its non-performing assets increased substantially, while confidence in the institution weakened after a credit-rating downgrade in September 2008. Between July and late September 2008, customers withdrew more than $22 billion in cash, including approximately $16.7 billion during a nine-day deposit run. On September 25, 2008, the Office of Thrift Supervision seized Washington Mutual Bank and placed it into Federal Deposit Insurance Corporation receivership. The FDIC sold the bank’s deposits, branches, and most operating assets to JPMorgan Chase for $1.9 billion, with JPMorgan Chase also assuming specified liabilities. Equity interests and much of the holding company’s debt were not transferred in the transaction. Washington Mutual’s banking operations were consequently absorbed into Chase, and the former WaMu branches were rebranded by the end of 2009. The seizure represented the largest bank failure in American history by total assets at the time. Washington Mutual, Inc., stripped of its principal banking subsidiary, filed for voluntary Chapter 11 bankruptcy protection in Delaware on September 26, 2008. The holding company later challenged the seizure and sale, filing a lawsuit against the FDIC in 2009 and seeking damages over the asserted legality of the takeover and the value received in the JPMorgan Chase transaction. The Washington Mutual name survived mainly in historical and legal contexts rather than as an operating nationwide bank brand.
History
Washington Mutual was established in Seattle on September 25, 1889, as the Washington National Building Loan and Investment Association. Its creation followed the Great Seattle Fire, which destroyed much of the city’s central business district and increased demand for rebuilding finance. The organization made what is described as the first home-mortgage loan on the West Coast in February 1890. It adopted the name Washington Savings and Loan Association in 1908 and began operating as Washington Mutual Savings Bank in 1917. The institution remained a mutual savings bank for much of the twentieth century. It acquired Continental Mutual Savings Bank in 1930 and gradually broadened its retail presence. In the 1980s, it began a major transformation. It acquired Seattle brokerage firm Murphey Favre in 1982, demutualized in 1983, and offered shares as a capital-stock savings bank on March 11 of that year. During the following decade, the company expanded through acquisitions and geographic growth, particularly in the Pacific Northwest. It purchased or absorbed branches and institutions associated with Lincoln Mutual, Columbia Federal, Shoreline Savings, Old Stone Bank of Washington, failed thrifts handled by the Resolution Trust Corporation, VanFed Bancorp, Sound Savings, Great Northwest Bank, and other regional operators. Washington Mutual entered Oregon through the acquisition of CrossLand Savings branches in 1991 and expanded substantially through the 1993 purchase of Pacific First Financial. It also acquired Pioneer Savings Bank, Far West Federal branches, Western Bank, Enterprise Bank, and other institutions. These transactions increased its consumer-deposit base and helped it become a major regional banking group. In 1994, the organization created Washington Mutual, Inc. as a holding company and renamed its primary banking subsidiary Washington Mutual Bank. The company continued to trade publicly on Nasdaq under the symbol WAMU. The group then pursued a broader national strategy. It acquired mortgage platforms including PNC Mortgage, Fleet Mortgage, and Homeside Lending, becoming one of the largest mortgage lenders in the United States. In October 2005, it acquired Providian Financial for approximately $6.5 billion and became one of the country’s largest credit-card companies. Rapid integration of acquired operations produced customer-service and account-administration problems in some cases, including difficulties associated with the Dime and Fleet Mortgage integrations. These issues formed part of the background to later criticism of the company’s growth model, although the institution’s decisive failure was driven by the housing and credit crisis. At its peak, Washington Mutual operated a large branch network and offered deposits, mortgages, home-equity products, credit cards, and commercial banking services. Its mortgage portfolio included substantial volumes of option adjustable-rate mortgages, subprime loans, and home-equity credit. It also serviced hundreds of billions of dollars in mortgages for itself and other institutions. As housing conditions deteriorated, delinquencies and non-performing assets increased. A credit-rating downgrade in September 2008 weakened public confidence, and customers withdrew approximately $16.7 billion in deposits over nine days. Total cash outflows since July exceeded $22 billion. On September 25, 2008, the Office of Thrift Supervision seized Washington Mutual Bank and transferred it to FDIC receivership. The FDIC sold the banking operations to JPMorgan Chase for $1.9 billion, together with the assumption of specified secured and unsecured obligations. Claims associated with the subsidiary’s equity and much of its debt remained outside the sale. The transaction removed the operating bank from Washington Mutual, Inc., leaving the holding company with assets and liabilities but no banking subsidiary. The parent filed for Chapter 11 bankruptcy in Delaware on September 26, 2008. The transaction was the largest American bank failure by total assets at the time. JPMorgan Chase converted the former Washington Mutual branches to Chase branches, completing the rebranding by the end of 2009. In March 2009, Washington Mutual, Inc. sued the FDIC, claiming that the seizure and sale were improper and seeking approximately $13 billion in damages. JPMorgan Chase responded with a counterclaim in the bankruptcy proceedings. The WaMu operating brand disappeared from mainstream banking, while its corporate, legal, and historical legacy remained connected to the 2008 financial crisis.
- 2008
Bank seized and sold during financial crisis
[1]The OTS closed Washington Mutual Bank on September 25 and the FDIC sold its banking operations to JPMorgan Chase.
- 2008
Holding company enters Chapter 11
[1]Washington Mutual, Inc. filed voluntary Chapter 11 bankruptcy protection on September 26.
- 2005
Providian acquisition
[1]The company purchased Providian Financial, expanding its consumer credit-card operations.
- 1994
Holding-company reorganization
[1]Washington Mutual, Inc. became the holding company, while Washington Mutual Savings Bank was renamed Washington Mutual Bank.
- 1983
Demutualization and public listing
[1]Washington Mutual converted from a mutual institution into a publicly owned capital-stock savings bank.
- 1917
Adopts Washington Mutual Savings Bank name
[1]The institution began operating under the Washington Mutual Savings Bank name.
- 1890
First recorded West Coast home-mortgage loan
[1]The organization made its first home-mortgage loan on February 10.
- 1889
Organization established in Seattle
[1]The Washington National Building Loan and Investment Association was incorporated after the Great Seattle Fire.
Products and positioning
Mass-market American retail bank with a strong consumer, mortgage, and household-finance orientation.
Retail banking
Retail deposit accounts
Washington Mutual operated a broad consumer deposit franchise offering checking, savings, and related branch-based banking services. Deposits were central to its retail strategy and supported its mortgage and consumer-credit activities until the bank entered FDIC receivership in 2008.
Mortgage lending
Residential mortgages
Mortgage lending was one of WaMu’s defining business lines. Through organic growth and acquisitions such as PNC Mortgage, Fleet Mortgage, and Homeside Lending, the company became one of the largest American mortgage lenders. Its portfolio included conventional mortgages, option adjustable-rate mortgages, subprime loans, and mortgage-servicing activities.
Consumer lending
Home-equity lending
The bank offered home-equity lines of credit and related borrowing products secured by residential property. These products formed a substantial part of its consumer-loan exposure before the housing downturn.
Credit cards · 2005
Consumer credit cards
WaMu expanded materially into credit cards through its 2005 acquisition of Providian Financial. The business targeted consumer cardholders and complemented the company’s deposit, mortgage, and household-finance relationships.
Commercial banking · 1995
Commercial banking
Washington Mutual entered commercial banking through the acquisition of Enterprise Bank and later maintained commercial-banking capabilities through institutions such as Western Bank. This business broadened the company beyond its traditional savings-and-loan charter and consumer focus.
Marketing campaigns
- The Friend of the Family
United States
A long-running brand slogan positioned Washington Mutual as a familiar, relationship-oriented financial institution serving ordinary households.
Outcome. The slogan remained associated with the brand during its expansion, but the operating brand disappeared after the 2008 sale to JPMorgan Chase.
Brand decisions
2008
Transfer banking operations to JPMorgan ChaseM&ABackground
A deposit run, mortgage losses, declining confidence, and regulatory concerns left Washington Mutual Bank unable to continue independently.
Action taken
The FDIC placed the bank into receivership and sold most banking operations to JPMorgan Chase for $1.9 billion.
Aftermath
The WaMu banking operation ceased to exist as an independent institution, its branches were converted to Chase branches, and the holding company entered bankruptcy.
FDIC sale consideration. $1.9 billion (September 25, 2008)
2005
Acquire Providian FinancialM&ABackground
Washington Mutual wanted to increase its scale in consumer credit cards and diversify beyond deposits and mortgages.
Action taken
The company acquired Providian Financial for approximately $6.5 billion.
Aftermath
WaMu became one of the largest credit-card companies in the United States, but its broader consumer-credit exposure remained part of the risk profile before the crisis.
Acquisition value. approximately $6.5 billion (2005)
1994
Create a financial holding-company structureStrategyBackground
Washington Mutual had expanded beyond a single traditional savings-bank operation.
Action taken
Washington Mutual, Inc. became the parent company and Washington Mutual Bank became the principal banking subsidiary.
Aftermath
The structure separated banking and non-banking activities and remained in place until the bank’s 2008 receivership.
1983
Convert from mutual ownership to public ownershipStrategyBackground
The institution sought greater access to capital and a structure suited to expansion through acquisitions.
Action taken
Washington Mutual demutualized and became a publicly traded capital-stock savings bank.
Aftermath
The change enabled a long period of acquisition-led growth and later supported the creation of a holding-company structure.
Recent events
- 2009
Washington Mutual sues the FDIC over seizure and sale[1]
Lawsuit · Regulation
The holding company filed a federal lawsuit seeking approximately $13 billion, alleging that the seizure was unjustified and that the sale to JPMorgan Chase undervalued the banking subsidiary.
- 2008
Office of Thrift Supervision seizes Washington Mutual Bank[1]
Bankruptcy · Regulation · Other
After a severe deposit run and mounting mortgage-related losses, the Office of Thrift Supervision closed Washington Mutual Bank and appointed the FDIC as receiver.
- 2008
FDIC sells Washington Mutual banking operations to JPMorgan Chase[1]
M&A · Other
The FDIC transferred the bank’s deposits, branches, and most operating assets to JPMorgan Chase in a transaction valued at $1.9 billion, excluding specified equity and unsecured-debt claims.
- 2008
Washington Mutual, Inc. files for Chapter 11 bankruptcy[1]
Bankruptcy
The former holding company filed voluntary Chapter 11 bankruptcy protection one day after its banking subsidiary entered FDIC receivership.
- 2005
WaMu completes Providian Financial acquisition[1]
M&A
Washington Mutual acquired Providian Financial in a transaction of approximately $6.5 billion, materially expanding its credit-card business.
Sources1 sources
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