JPMorgan to grant WaMu access to $4.4 billion in funds
NEW YORK (Reuters) - JPMorgan Chase (JPM.N) agreed to allow bankrupt savings and loan Washington Mutual Inc's WAMUQ.PK parent company to access $4.4 billion of its funds that may be used to help pay creditors.
WaMu's parent company can take back control of $707 million in deposits it had at Washington Mutual Bank and $3.7 billion it held at the bank's subsidiaries, according to documents filed with Delaware Bankruptcy Court on Tuesday. The agreement requires court approval.
JPMorgan agreed to buy Washington Mutual Inc last month after the owner of Washington Mutual Bank entered into receivership. Following the transaction, the companies entered into a standstill agreement limiting access to the deposits in order to give the companies time to verify the amounts, according to the documents.
Washington Mutual's holding company said in earlier court filings that it had about $5 billion on deposit with its banking subsidiaries prior to entering bankruptcy protection.
Creditor lawyers had been concerned that the funds in the deposits would not be available to pay back their clients. When the Seattle-based savings and loan company filed for bankruptcy protection, it listed $32.9 billion in assets and $8 billion in debt.
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