Make us your home page

Wachovia Corp. posts $24-billion quarterly loss

Wachovia Corp., the biggest bank operating in Florida, posted the largest-ever quarterly loss for a bank today.

The $23.7-billion third-quarter loss dwarfs the roughly $14-billion that Wells Fargo is paying to buy Wachovia. That's nearly the combined market cap value of regional rivals BB&T and Regions Financial. And it includes a goodwill impairment charge of $18.7-billion, coming shortly after the pre-crisis Wachovia told analysts there would be no such charge.

The loss, which translates to $11.18 per share, follows a $9.11-billion loss in the second quarter.

Any questions?

If so, Wachovia wasn't prepared to listen Wednesday morning. Instead of the typical earnings conference call with analysts, the Charlotte, N.C., bank posted a pre-recorded conference call with three top executives, minus the ability of analysts to call in with questions. One reason for its reticence: The Wachovia/Wells Fargo deal was struck after Citigroup initially agreed to a government-backed buyout of Wachovia, and now Citigroup is suing both companies to recover billions in damages.

Goodwill impairment reflects the declining fair market value of an asset. In this case, it's the difference between what Wachovia paid for certain assets and how Wells Fargo values them. According to Wachovia, about two-thirds of the write-down was connected with its retail and small-business operations, home to the bank's troubled portfolio of adjustable-rate mortgages.

"The unprecedented, almost unimaginable, events of the third quarter and the consideration for our pending merger with Wells Fargo created a scenario that required goodwill impairment," Wachovia chief financial officer David Zwiener said in the pre-recorded call.

Wells Fargo president and chief executive John Stumpf said in a statement that Wachovia's results were "very much in line with our expectations. … We're more encouraged than ever by what we've seen in their franchise, and we're pleased that Wachovia's team continues to focus on serving customers."

The combined company will have total assets of $1.4-trillion and $787-billion in deposits.

Jeff Harrington can be reached at or (727) 893-8242.

Wachovia Corp. posts $24-billion quarterly loss 10/22/08 [Last modified: Wednesday, October 22, 2008 4:48pm]
Photo reprints | Article reprints

© 2017 Tampa Bay Times


Join the discussion: Click to view comments, add yours

  1. Tampa is 15th-most popular city to move to with U-Haul


    TAMPA —Tampa is undoubtedly a destination point, at least according to U-Haul.

    Tampa is the No. 15 destination for people moving with U-Haul trucks. | Times file photo
  2. Florida's economy growing faster than other big states and far better than U.S. overall


    When it comes to economic growth, Florida's running alongside the leading states and well ahead of the United States as a whole.

  3. Westshore Marina District project takes shape with another acquisition

    Real Estate

    TAMPA — One of Tampa Bay's prime waterfront areas took another major step toward redevelopment Friday as WCI Communities bought 2.35 acres in Westshore Marina District.

    WCI Communities, Lennar's high-end subsidiary,has paid $2.5 million for 2.35 acres in the Westshore Marina District for 35 townhomes. WCI is under contract  to buy an additional 9.5 acres.
[BTI Partners]
  4. Posh Guy Harvey RV park to open in Tampa Bay with $250,000 cottages


    HOLIDAY — Love those Guy Harvey T-shirts with the soaring marlins? In the not too distant future, you might be able to kick back in your own Guy Harvey cottage in the first-ever Guy Harvey RV park.

    Renderings of the clubhouse and an RV cottage site of the planned Guy Harvey Outpost Club & Resort Tarpon Springs.
[Guy Harvey Outpost Collection]
  5. Port Tampa Bay secures $9 million grant to deepen Big Bend Channel


    Port Tampa Bay has secured a $9 million grant from the U.S. Army Corps of Engineers for the widening and deepening of the Big Bend Channel in southern Hillsborough County.