Capital concerns batter WaMu stock

Pacific Northwest

Banking

Shares of Washington Mutual sank further Thursday, as the ailing thrift was forced to deny an analyst's contention that the company faced a cash crunch.

Kathleen Shanley of bond-research firm Gimme Credit noted that two sources of short-term cash for WaMu — borrowings from other banks in what's called the federal funds market, and notes called commercial paper — fell to $75 million in the second quarter, from $2 billion at the end of 2007 and $3.4 billion a year ago.

In addition, securities sold under agreements to repurchase are down to $214 million, from $9.4 billion a year earlier, and other borrowings were $30.6 billion versus $40.3 billion in December.

All that, Shanley said, suggests that lenders are shying away from WaMu.

WaMu, though, has said that between the $7.2 billion it raised in April, its $181.9 billion deposit base and available Federal Home Loan Bank advances, it has little need to borrow funds.

"As we stated publicly months ago, WaMu funds all of its business through its banking operations and does not rely on commercial paper," the bank said in a statement.

Nonetheless, WaMu stock lost 62 cents, or 13.3 percent, closing at $4.03 Thursday.

Wireless

AT&T opposed to network venture

AT&T urged regulators to reject Sprint Nextel's proposal to combine its high-speed wireless network with Clearwire.

An application the companies filed with the Federal Communications Commission last month is "fatally defective" because it understates the amount of wireless airwaves the venture would control, AT&T told the FCC Thursday in a petition.

Sprint and Kirkland-based Clearwire plan to build a nationwide wireless network that offers faster Internet downloads than AT&T and Verizon Wireless now offer for mobile devices. Intel, Comcast, Time Warner Cable, Google and Bright House Networks plan to invest $3.2 billion in the venture.

Compiled from Seattle Times business staff and Bloomberg News