Washington Mutual (WaMu) announced a $3.3 billion net loss in the second quarter of 2008, driven primarily by a $6.0 billion provision for loan losses. The company is projected to have losses of $3.60 per share this year and $1.50 per share next year.
WaMu also has high exposure to subprime loans, option ARMs, brokered loans and the California market i.e. all products and geographic locations that have been hit hard in the downturn. Of its $250 billion loan portfolio, $11.2 billion of that portfolio is non-performing, up from $4.0 billion a year ago. As such, WaMu is worse off as compared to Wachovia where only 2.4% of the portfolio was non-performing.
In addition, revenues from WaMu's credit card division are down by 9%.