Wamu's Failure
- Submitted by: skscollins02
- Views: 934
- Category: English
- Date Submitted: 06/15/2010 03:57 PM
- Pages: 4
- Report this Essay
WaMu Bank Failure
Shamita Robins
LDR 531
May 12, 2010
JoAnn Spurlock
WaMu Bank Failure
In September 2008 Washington Mutual Incorporation (WaMu) experienced failure because of the lack of risk management, inflation of home values to justify larger loans, and used dangerous underwriting standards (Carter, 2009). WaMu was seized by the Federal Deposit Insurance Corporation. WaMu lost approximately $17 billion in deposits in nine days. The cause for this failure was because of poor leadership and lack of ineffective management teams.
Leadership according to (Yakl, 2006) is leading or directing the behavior of an individual or group of individuals toward a specific goal or outcome. Leadership is the ability to promote others to establish an effective role in the success of an organization. WaMu evidently did not have effective leaders within the company teams. The company lacked guidance, structure, and organization. Many of the company’s leaders were not overseers of the company. The leaders did not adhere to the company policies. WaMu executive employees were being greedy, and as a result WaMu incorporation is filing bankruptcy for their corrupt actions. The company has many upper level employees being investigated for risky mortgage loans and fraudulent security deposits. Although there are many upper level executives; the lower level managers are the first on the list for investigators. “You start with the little fish and work your way up,” according to Lis Wiehl, a Seattle prosecutor. The leaders of the WaMu Company will be prosecuted; the managers and the lower level employees will also face incrimination if convicted of any wrongdoing.
A manager role is to instruct or dictate to subordinates. Managers instruct to others what needs to be done. The management team at WaMu did not have effective managers in place to instruct and manage the duties of others. WaMu’s management team did not make good business decisions. The company failed at...
Shamita Robins
LDR 531
May 12, 2010
JoAnn Spurlock
WaMu Bank Failure
In September 2008 Washington Mutual Incorporation (WaMu) experienced failure because of the lack of risk management, inflation of home values to justify larger loans, and used dangerous underwriting standards (Carter, 2009). WaMu was seized by the Federal Deposit Insurance Corporation. WaMu lost approximately $17 billion in deposits in nine days. The cause for this failure was because of poor leadership and lack of ineffective management teams.
Leadership according to (Yakl, 2006) is leading or directing the behavior of an individual or group of individuals toward a specific goal or outcome. Leadership is the ability to promote others to establish an effective role in the success of an organization. WaMu evidently did not have effective leaders within the company teams. The company lacked guidance, structure, and organization. Many of the company’s leaders were not overseers of the company. The leaders did not adhere to the company policies. WaMu executive employees were being greedy, and as a result WaMu incorporation is filing bankruptcy for their corrupt actions. The company has many upper level employees being investigated for risky mortgage loans and fraudulent security deposits. Although there are many upper level executives; the lower level managers are the first on the list for investigators. “You start with the little fish and work your way up,” according to Lis Wiehl, a Seattle prosecutor. The leaders of the WaMu Company will be prosecuted; the managers and the lower level employees will also face incrimination if convicted of any wrongdoing.
A manager role is to instruct or dictate to subordinates. Managers instruct to others what needs to be done. The management team at WaMu did not have effective managers in place to instruct and manage the duties of others. WaMu’s management team did not make good business decisions. The company failed at...