User 273419

Wachovia-Golden West Transaction: A Disaster Without Peer

It was Wachovia's poor management style & inability to run a mortgage company that led it's demise. Golden West Financial was a great company that practiced conservative lending standards & had a lower deliquency ratio that most other banks. Wachovia did not know how to run a profitable business and grow like a normal firm. They would simply buy up other companies and use this for growth and expansion. The problem is that they were buying good companies and then trying to implement their own management style and business practices. Golden West Financial was the 2nd best performing stock on the S&P 500 for over 20 years. Berkshire was # 1. So, if you're buying a company based on it's performance and profitability, then why would you change it. Wachovia fired many senior executives at Golden West and put their people in charge of operations. At the end of the day, the ruined one of the most profitable and well-run lending instutions that we will ever see. Shame on them. I am not sad to see Wachovia fail, becuase they brought it upon themself. I am sad that thousands of hard working employees had to lose their jobs, and stock holders lost roughly 95% of their value over the past two years.