Friday, September 26, 2008

Wipeout: Washington Mutual Bondholders

FT Alphaville quotes Royal Bank of Scotland as expecting very little recovery:
...Either way, recovery values are going to be pretty grim and low to mid-single digit looks to be likely.

There is now a precedent set which is taxpayer friendly and 100% risk asset hostile.

There’s confusion as to which WaMu debtholders may have been saved by the JPM deal. There may be none - there may be some. It all depends on which part of WaMu the debt was issued from and whether JPM has bought that part. It isn’t really clear where WaMu’s $11bn covered bond programme falls, either

As of yesterday, there was around $28bn of WaMu bonds in issuance, from a range of different companies and subsidiaries under the WaMu parent company.

Here is a list of the top WaMu debt holders, and the sizes of their holdings. Lots of insurance companies.

1) Capital Research and Management - $1.5bn
2) Vanguard Group Incorporated - $336m
3) American Life Insurance - $166m
4) Teachers Insurance and Annuity Co - $159m
5) Jackson National Life Insurance - $148m
6) Nuveen Advisory Corp - $124m
7) Genworth Life Insurance - $113m
8) Principal Life Insurance - $97m
9) AIG Annuity Insurance Co - $93m
10) Hartford Life Insurance Co - $91m
11) Metropolitan Life Insurance Co - $88m
12) AXA Equitable Life Insurance - $85m
13) Sun Life Assure Co of Canada - $82m
14) Thrivent Financial for Lutheran - $80m
15) Western Asset Management - $77m
16) Principal Asset Management - $69m
17) Allianz Life Insurance Co of North America - $59m
18) Riversource Life insurance co - $58m
19) Northwestern Mutual Life Insurance - $57m
20) Lincoln National Life Insurance - $56m

Then of course, there’s CDS on WaMu. All of which will have been triggered since most reference the parent company that JPM has left behind....MORE

The Ventures: