Washington Mutual says it swung to a loss in the second quarter as it increased to more than $8 billion its reserve to cover sour loans.
For the April-to-June period, the Seattle-based bank says it lost $3.33 billion, or $6.58 per share, which compares with a profit of $830 million, or 92 cents per share in the year-ago period. Results include a previously disclosed, one-time reduction of $3.24 per share related to the company’s capital raising in April.
Thomson Financial says analysts, on average, were expecting a loss of $1.05 per share.
The bank says it increased its loan loss reserves by $3.74 billion to $8.46 billion during the quarter, as it continues to face mounting losses stemming from bad mortgages.