WaMu posts first quarterly loss in a decade

Washington Mutual today said it lost nearly $1.9 billion in the last quarter of 2007 — the giant thrift's first quarterly loss since 1997 — as the meltdown in the nation's housing and credit markets continued to wreak havoc on the company's business model.

The fourth-quarter loss at Seattle-based WaMu worked out to $2.19 a share, two cents more than the average estimate of Wall Street analysts surveyed by Thomson Financial.

WaMu's home loans group lost nearly $2 billion all by itself, due mainly to $1.78 billon in writeoffs. The quarterly loss in home loans was partially offset by small operating profits in the company's other divisions: retail banking, credit cards and commercial lending.

For the full year, WaMu reported a $67 million loss — its first annual loss since at least 1994.

In an interview with The Seattle Times, WaMU chief executive Kerry Killinger sought to dampen speculation that the company was headed for the auction block, as has happened already to competitor Countrywide Financial.

While declining to comment specifically on reports that WaMu has had preliminary talks with JPMorgan Chase, Killinger said he was "working very hard to return the company to much higher levels of profitability, which I believe it is capable of doing."

WaMu's board of directors, he added, "has been very supportive and has approved the plans we are executing."

The financial results were issued shortly after the close of regular trading on the New York Stock Exchange, in which WaMu shares fell 93 cents to close at $12.46. The stock moved slightly higher in after-hours trading, in advance of a scheduled conference call with analysts and investors.

Drew DeSilver: 206-464-3145 or ddesilver@seattletimes.com