I believe the most surprising news today is the failure of WaMu. On Thursday, Washington Mutual Inc was closed by the U.S. government and all the assets were sold to JPMorgan Chase & Co for $1.9 billion. What a shock! This would be the biggest bank failure in US history. The largest US savings and loan will be out of US banking history in the future with more than 100 years’ history.

WaMu was one of the hardest hit banks by the housing bust and credit crisis. Although the WaMu is taken over by FDIC, all customers should expect business as usual on Friday, and all depositors are fully protected. Note that most bank failures are released on Friday, giving it the weekend to go through the books and enable them to reopen smoothly the following Monday. This time, the news is leaked from the media.

The transaction means JPMorgan Chase & Co will now have 5,410 branches in 23 U.S. states from coast to coast, as well as the largest U.S. credit card business. This means the JPMorgan Chase & Co will be the largest credit card issuer in US. At the same time, JPMorgan Chase & Co will past Bank of America and becomes the second largest bank in US just behind Citigroup. If Bank of America completes its purchase of Merrill Lynch & Co, then Bank of America will the nation’s largest bank.

Obviously,  the WaMu’s collapse is the latest of a series of takeovers and outright failures that have changed the American financial situation. Think about this: government takeovers of mortgage companies Fannie Mae and Freddie Mac and the insurer American International Group; bankruptcy of Lehman Brothers Holdings Inc; JPMorgan Chase & Co’s purchase of Bear Stearns; the unknown future of Merill Lynch. The question remains: Who will be the next?

The full coverage of the WaMu failure can be found here.