Chronology: From Bear to WaMu, credit crunch victims pile up
Following are some of the key events in the biggest financial industry crisis since the Great Depression.business Updated: Sep 26, 2008 09:25 IST
Following are some of the key events in the biggest financial industry crisis since the Great Depression.
* Jan 11, 2008: Bank of America pays $4 billion for Countrywide Financial after the mortgage lender goes bust when risky loans to shaky borrowers fail.
* Jan 30: UBS announces $4 billion new write-downs, taking total subprime-related writedowns to $18.4 billion.
* Feb 17: UK's Northern Rock nationalised after funding crisis.
* March 16/17: Bear Stearns sold to US investment bank JP Morgan Chase for about $2 a share.
* July 13: US Treasury and Federal Reserve effectively nationalise mortgage finance companies Fannie Mae and Freddie Mac in a bid to support US housing market.
* Sept 15: Wall Street's worst day since markets reopened after the September 2001 attacks; Lehman Brothers in largest US bankruptcy; Merrill Lynch taken over by Bank of America; American International Group, once the world's top insurer, scrambles for capital because of losses on its mortgage-related debt.
* Sept 16: Central banks pump billions of dollars into money markets in a bid to ease tensions and prevent global financial system from freezing: AIG shares almost halve. Fed announces plan for $85 billion AIG rescue loan in return for 80 percent stake; Britain's Barclays buys parts of Lehman's North American assets for $1.75 billion.
* Sept 17: Shares in Goldman Sachs and Morgan Stanley fall sharply; Britain's Lloyds TSB buys rival HBOS US Securities and Exchange Commission (SEC) curbs short-selling.
* Sept 19: World stock markets soar on US plans to buy up so-called toxic assets, helping cleanse the financial system.
* Sept 20-21: Details emerge of US plan for $700 billion bailout for firms burdened by bad mortgage debt; Goldman Sachs, Morgan Stanley transformed into bank holding companies, ending Wall Street's investment banking model.
* Sept 22: Japan's Nomura Holdings buys Lehman's Asia operations for up to $525 million. Later, Nomura pays a nominal sum for Lehman's Europe and Middle East operations; Mitsubishi UFJ Financial agrees to buy up to 20 percent of Morgan Stanley for $8.5 billion.
* Sept 23: Warren Buffett pays $5 billion for up to 9 percent of Goldman Sachs; FBI probes Fannie, Freddie, AIG and Lehman for potential mortgage fraud.
* Sept 24: In nationwide broadcast, US President George W. Bush warns that financial system at risk of shutting down. Urges agreement on $700 billion bailout.
* Sept 25: Biggest US bank failure as authorities close Washington Mutual and sell parts to JPMorgan Chase for $1.9 billion.