Starts preliminary talks with Citigroup and others

NEW YORK: Financial turbulence in the U.S. took yet another toll with America’s sixth largest bank, Wachovia, starting preliminary talks with potential buyers including Citigroup, Wells Fargo and Spain’s Banco Santander, media reports say.

The reports about Wachovia looking for a bailout buyer appeared in media a day after the collapse of Washington Mutual, the biggest bank failure of U.S. history.

According to reports, Wachovia has assimilated distressed assets worth $122 billion on account of its exposure in the housing mortgage.

Wachovia, according to its website, has assets of over $800 billion and its brokerage operations manage $1.1 trillion of client assets.

“Wachovia approached potential buyers, including Citigroup, Wells Fargo and Spain’s Banco Santander, on Friday after a 27 per cent plunge in its shares deepened fears over the future of the sixth-largest US bank,” U.K. daily Financial Times reported. After assessing the fallout situation of its shares, Wachovia executives led by its CEO Robert Steel contacted Citi, Wells and Santander, the report said.

These three financial majors — Citi, Wells and Santander — were also interested to buy Washington Mutual Inc but ultimately JPMorgan acquired most of the WaMu.

However, U.S. financial daily Wall Street Journal reported that, “Wachovia officials don’t believe they need to rush into a deal, and the bank isn’t feeling immediate pressure on its financial condition,” quoting people familiar with the company. — PTI