WILMINGTON, Del. — Washington Mutual Inc. has tentatively resolved disputes with JPMorgan Chase & Co. and the Federal Deposit Insurance Corp. over some $4 billion at issue in the bank holding company’s Chapter 11 bankruptcy, a WaMu attorney said Friday.
The FDIC seized Washington Mutual’s flagship bank in 2008 and sold its assets to JPMorgan for $1.9 billion. The sale resulted in the two banking companies and the government agency trading lawsuits over roughly $4 billion in disputed deposit accounts.
WaMu attorney Brian Rosen told U.S. Bankruptcy Judge Mary Walrath on Friday that JPMorgan has agreed to turn over the money to Washington Mutual after deducting $172 million as its share of tax refunds received.
In return, JPMorgan will get 70 percent of expected tax refunds resulting from WaMu’s prior operating losses that are valued at about $3 billion, with WaMu getting 30 percent.
WaMu also will get about 40 percent of a second round of operating-loss tax refunds valued at about $2.6 billion, with roughly 60 percent going to the FDIC.
Shares of WaMu closed down 18 cents, or 47 percent, at 19 cents in over-the-counter trading.
Rosen said documentation of the settlement will be included in a reorganization plan to be filed by March 26.
