JPMorgan snaps up Washington Mutual

The US government has made a fresh market intervention, brokering the bail-out of Washington Mutual, America’s largest savings and loan bank, by JP Morgan, America’s number three.

Washington Mutual’s bankruptcy is the biggest in US banking history, and JP Morgan gets its deposits for just under two billion dollars, at a stroke getting a long-cherished foothold in the retail sector.

Unlike Bear Stearn’s investment banking, which was allowed to fail and go to the wall, the victims of the credit crunch have become progressively more and more central to the whole system. With the failure to immediately produce a rescue, the JPMorgan deal may be a morning market calmer.

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