Wells Fargo Wins, Will Buy Wachovia
Wells Fargo is the winner in the battle for Wachovia, says the New York Times. Apparently, Citibank became nervous about splitting the bank when they saw the size of the "bad assets" it would have to take on, and quietly walked away. The bank will continue to seek $60 billion in damages, however.
The Times says that if Wells Fargo is successful in a deal with Wachovia, it would elevate what is essentially an overgrown regional bank into a national player.
A deal with Wachovia would elevate Wells Fargo to a prime position in the American banking industry, with the largest nationwide deposit and branch franchise in the country. Together, Wells Fargo and Wachovia will have $1.42 trillion in assets, 48 million customers and 280,000 employees.
The combined bank will be present on both coasts in the fastest-growing markets, playing on the same field as JPMorgan Chase and Bank of America, two of the nation’s largest banks.
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Comments:
"I don't want that debt. You can have it. But I want $60 Billion from you because you stole that debt out from under me."
Uhh, riight. Just what our economy needs, another huge bank going under, only this time, as a result of one bank suing another.
Awesome job with choosing the pic for this post Meg!
Good For Everyone. And good luck on Citi to squeeze anything close to that in damages out of this deal..
I have a choice now,
Should my wife and I stay with Wachovia(wells Fargo).
or
Should my wife and I go with the credit union that her job just became affiliated with?
I still don't get the damages. Even putting aside the supposed $40bn in punitives, are Citi bank saying that they missing out on $20bn in cash from somewhere? Were they expecting a handout from the FDIC? If they were, it doesn't sound like it would have covered the bad debt. It sounds like they should be grateful that Wells rescued them from a bad deal. Wells on the other hand I don't think mind the bad debt as they have little of their own.
*shrug*
And I can finally breath a sigh of relief. I was ready to pull out of wachovia if citi won. Now I can sleep in tomorrow morning instead of spending it at banks.
@Phenostar: That's what I was thinking.. Only thing that's stopping me...
Being lazy
All my bill payments have to be reset up now.. ugh
It's like watching starving sharks turning on each other.
...Somebody bring me a popcorn...
Well, I guess a Big Three is better than just a Big One...
@12-Inch Idongivafuck Sandwich:
I fondly recall when one of those rolled into the local 7-11. We kicked its butt and it handed us ours on a regular basis.
That is until a couple of months later, the vendor came out and jacked the machine's difficulty up a couple of notches...
Then it REALLY started to kick our butts.
Wow Citi has gall. Yea, lets hit Wachovia with 60 billion on top of the current losses they face. Citi looked at the books and walked. They should be kicked in the balls.
@Skankingmike: Yeah. I feel that. I've got a joint account with my fiancée at Wachofargo and an account at a credit union that has about $3 in it because the only branch is like a 30 minute drive away.
Wells Fargo got this deal becaue Citi wanted only to buy the banking aspect (savings, checking, ect.) for $1.2 billion, while Wells Fargo wanted to purchace the whole enchilada for around $11 billion. Can't blame Wachovia for this one.
@Skankingmike: credit union. The only reason i am still split half and half is convenience. Once our credit unions online banking comes online, I am going right over to BoA and telling them to shove it
@zigziggityzoo: Thankfully, the only bank that would go under is the idiots at Citi. They are teh suck
@Skankingmike: Stick with Wells. Wachovia customers, once the transaction and conversion is complete, will get all the wonderfulness that is the WF online bill pay system. You will like it. The best part for you is that the conversion will happen without your even needing to be involved. Also, your bill pay setup should copy over to the new system.
@Phenostar: If they had won, you would still be with Wachovia. The problem here is that no one seems to realize that Citi wasn't buying the deposits side of the bank...and that would have left the FDIC in charge of the then defunct Wachovia.
@ct_price: I too look forward to WF coming to GA; only because my company in Seattle banks with them and there has been a few times it would have been easy to just walk in a WF and fix the problem.
Wachovia was going to fail. Citi kept that bank on life support for a week, and had a signed contract to merge with Wachovia.
Wells violated the exclusivity agreement, and is in breach of contract.
Citi is going to get some compensation for this, but not 60 billion.
@ct_price:
We had a good bank. I loved Washington Mutual. Good people, good savings acct rates, good branch hours. Now we have teh suck.
With WaMu and Wachovia gone it is the death of the truly free checking account at a national bank.
@Justinh6: Refer to Crymson77's post above; apparently Citi was going to pull the plug on the deposits side anyway (only keeping the part it wants), effectively dumping that on the government. Maybe they're in breach of some contract, but saying that Citibank was keeping it on life support isn't completely true (they threw some money around to keep it going, but they weren't going to take up all of the bank).
@Crymson_77: I complained in an earlier thread about that; some commenter then told me that no, Citi isn't leaving anything behind for the government to deal with...
@Justinh6: Citi never actually injected funds from whats being reported. All citi did was bring to light how cheap they had planned to purchase Wachovia. Other than that exclusivity agreement nothing changed hands and from what some are saying who are close to the groups, the exclusivity agreement might have even been illegal, which if that is the case I can better you Wells will give Citi maybe a couple million and say get loss or we will expose you.
@Caffiend: Not to mention that Citi wanted dear old Uncle Sam to help out whereas WF doesn't need our tax money.
@Crymson_77: actually citi was ONLY buying the deposits side. All Wachovia depositors would have become Citi depositors. Now they (I) will become Wells depositors.
Sweet, a national bank that employs smart people! too bad they still sucks, and like to steal money from their depositors.
@Skankingmike:
Depending on the credit union, go with them. If they aren't that good, look around, there are bound to be other credit unions that you qualify for. howeever, don't close your Wells Fargo account, just keep an eye on it for fees and charges...
@Skankingmike: Use both. There are a lot of benefits to having an account with a CU, but WF has the best online banking and once the branches are all integrated you'd be able access your WF money anywhere.
@12-Inch Idongivafuck Sandwich: But alas, not a "flawless" victory.
Wait, I'm not going to be a Citibank customer! WOO HOO!
@Crymson_77: Bill Pay??? Are you f'ing serious? Wells fargo charges you $7 a month for the privilege of using bill pay. Also pretty much all their checking products have fees out the ass for everything. They are THE WORST bank in the country, easily beating the loathsome BofA.
I just want to take this opportunity to say to all Wachovia customers:
RUN! AWAY! NOW!
Wells Fargo has been my father's bank for something like 30 years, and they are a bunch of slimeballs.
1. Fees for everything, even stuff every other bank gives away for free, like online bill pay.
2. Fees to move your own money around, like if you have checking and savings linked for overdraft protection.
3. They bought my mother-in-law's mortgage, and through sheer incompetence, ruined her opportunity to execute a short sell as the real-estate market tanked (they delayed taking action for over two months because someone at WFB had given the paperwork to "the wrong department"), a blunder that resulted directly in foreclosure.
Their branches are full of slick salesmen who will talk you into anything. Their interest rates are horrible both for lending and for saving. They are the ultimate predatory bank. You'd be better off stashing your money in shoeboxes, and doing your borrowing from check-cashing stores.
People love their cutesy ads, OOH LOOK, IT'S THE OLD WEST BANK WITH THE HORSIES AND STAGECOACHES! Whatever. They are poster children for the "New School" method of doing business: Rip off, cheat, outright steal--anything to maximize profit. It's okay as long as you hide it all in the fine print.
I have to think through this thoroughly and deeply. U made good points and I'll watch how these merger goes n what it translates to for end consumers..
I'm sure they'll be sending out changes to consumers and I'll run when I start seeing stupid charges..
@West Coast Secessionist: You need to go into your local branch and tell them you don't want to pay bill pay fees anymore. They will take care of it for you. I just went in yesterday for an unrelated issues, they guy noticed I was being charged a bill pay fee on one of my accounts and not the other (I have two checking accounts with them)and he went ahead and removed the fee.
I think both institutions bring great strengths to this deal. While many analysts fault Wachovia for its acquisitions (specifically Golden West) and its lack of adequate risk controls, Wachovia has a great franchise with a stellar reputation for its customer service and technology platform. As a customer who lived through both the Wells Fargo/ First Interstate merger (which was a disaster) and the Wells Fargo/Norwest merger (which was a resounding success), I'm confident that Wells Fargo can pull this off seamlessly as they appear to have learned from their mistakes in their execution of the Wells/First Interstate deal. If the new Wells Fargo can find a blend between Wells Fargo's sales culture and Wachovia's customer service, we'll have a retail banking powerhouse.
@West Coast Secessionist:
I've only been a Wells Fargo customer (with regular accounts, home loan, small savings acct) for 4 years, and you are wrong. Free checking, free bill pay, I have no fees. You will incur a fee when you go over a certain number of transfers a month. Other banks have that as well. Yes, they are a modern bank with not-the-best rates, and I wouldn't get any other loans from them, but I've have had gracious and understanding customer service from them so far. It would be nice if they waived other banks ATM fees. I'm sorry to hear about your relatives' loss, but I would guess a foreclosure was already near.
Yeah, look at that scenery. Wouldn't you want to invest in that too? It's called marketing. Everyone does it.
@zigziggityzoo: That's exactly how I read it too. They had an opportunity to continue bidding, but no longer wanted to. But hey, we might still get some money from Wells if we sue them!
@West Coast Secessionist:
1. Do they not post their fee schedule? If they do, then I think that most people here have the ability to determine if WFC would charge them fees, or not.
2. See #1
3. Slow approvals are the main reason short sales do not happen, across all loan servicers.
As for the rest, that is some fantastic hyperbole.
Just wait until your Wachovia accounts start to fall under Well's policies. Nothing like getting charged so e extra insurance you didn't want and never agreed to, noting like getting called every night by telemarketers trying to sell you more crap and signing you up for it even when you deny it, or their collections department leaving you messages and when you finally take your lunchtime to call them back because thats the only time their office is open they don't know why they called you since your mortgage payment was on time.
Wells ranks right up there with Walmart and time warner in bad customer service.
Yeah for Atlanta, we will finally get a good bank!