With the failed Washington Mutual back in the news via a congressional investigation, some editors and writers this week continued to have a problem distinguishing between a commercial bank and a savings and loan association, notes Grumpy Editor.
Most print and broadcast outlets referred to Seattle-based Washington Mutual as “the biggest bank failure.”
But it was a savings and loan, also called a thrift.
Reuters correctly identified Washington Mutual as a S&L in the lead to a Monday story. But in the second paragraph it labeled WaMu (its abbreviated identification) as “the biggest bank failure in history.”
The nation’s largest S&L at the time, WaMu filed for bankruptcy in September, 2008, in the wake of mounting sub-prime loans. It was sold later to New York-based JPMorgan Chase & Co.
The Los Angeles Times, in a state where WaMu had nearly one third of its branches, referred to the financial institution’s collapse as “the largest bank failure in U.S. history.” Although Times writers continued to describe it as “the bank” in the second paragraph, a caption to a photo accompanying the Monday story got it right, with “Seattle-based thrift.”
USA Today, the Washington Post and many others relying on Associated Press reports, also identified WaMu as “the biggest U.S. bank ever to fail."
The Wall Street Journal, in a major story yesterday, also labeled the WaMu episode as “the largest bank failure in U.S. history,” then went on in following paragraphs branding the financial institution a “thrift.”
Unlike commercial banks such as Bank of America, N.A., Wells Fargo & Co., JP Morgan Chase & Co. and Citigroup Inc., WaMu’s primary regulator was the Office of Thrift Supervision --- within the Treasury Department --- that focuses on thrifts.