In September of 2008 the FDIC paid JP Morgan Chase to purcha

In September of 2008, the FDIC paid JP Morgan Chase to purchase all of the assets of and assume all of the liabilities of Washington Mutual Bank. This was an outright bailout of a private company by the FDIC. What makes this more problematic is that uninsured creditors were compensated by the FDIC. T or F?

Solution

The statement is false. The uninsured creditors were not compensated in this transaction. In fact, uninsured depositors were benefitted from this transaction.