Losses for Wachovia

Wachovia has lost $.20/share or $350 million in the 1st quarter & in comparison it had earned $1.20/share in 1st quarter of 2007. The loss was mainly due to $2.1 billion in setting provisions against credit losses & asset write-downs to the tune of $2 billion.

Wachovia's problems started after it purchased a CA mortgage lender & bank - Golden West for $25.5 billion 2 years back. This acquisition exposed the company to aggressive lending practices & included more emphasis placed on Option ARMs & Interest Only mortgage loans. The bank apart from being hit by increased delinquencies in its mortgage loans mainly in CA, is also facing losses in its credit card, auto & home equity businesses.