WASHINGTON — In another consolidation among the nation's largest banks, Wells Fargo & Co. bought Wachovia Corp. for $15.4 billion, the financial institutions announced today.
The deal helps the San Francisco-based Wells Fargo, which has long lagged a presence on the East Coast and Charlotte, North Carolina-based Wachovia, which has suffered heavy losses because of problems with portions of its mortgage portfolio.
Wells Fargo is the nation's third largest bank in terms of deposits and Wachovia is the fourth largest.
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Earlier in the week, Wachovia had announced a deal to sell its banking operations to Citigroup. That deal was encouraged by the FDIC which had been nervous about Wachovia's vulnerability because of its mortgage difficulties.
The Wells Fargo-Wachovia merger is subject to approval by the Federal Reserve Board of Governors and the Office of Comptroller of the Currency.
"A new proposal to acquire Wachovia has emerged from Wells Fargo. The Citigroup proposal has undergone extensive review by the Federal Reserve and the Office of the Comptroller of the Currency. We have not yet reviewed the new Wells Fargo proposal and the issues that it raises. The regulators will be working with the parties to achieve an outcome that protects all Wachovia creditors, including depositors, insured and uninsured, and promotes market stability," those agencies said in a joint statement.
In June, Wachovia recently fired its longtime CEO, Ken Thompson, who had held the job for eight years and replaced him with former Undersecretary of Treasury Robert Steel.
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