Print Page Close Window

WaMu Reports Fourth Quarter Net Loss Per Share of $2.19, Reflecting Previously Announced After-Tax Charge to Writedown Home Loans Goodwill of $1.6 Billion and Elevated Loan Loss Provisioning

Declares Cash Dividend of 15 Cents

SEATTLE--(BUSINESS WIRE)--Jan. 17, 2008--WaMu (NYSE:WM) today announced a fourth quarter 2007 net loss of $1.87 billion, or $2.19 per diluted share. The company attributed the loss to the $1.6 billion after-tax charge to writedown Home Loans goodwill and the higher level of provisioning stemming from the housing market weakness. Due to fourth quarter results, the company recorded a net loss of $67 million, or $0.12 per diluted share, for all of 2007.

"We announced in December a series of proactive steps being taken to manage through the unprecedented market conditions that this company and others in the financial services industry face," said WaMu Chairman and Chief Executive Officer Kerry Killinger.

    "These actions included:

    --  The raising of $2.9 billion in net proceeds through the
        issuance of convertible preferred stock that increased the
        year-end tangible capital to tangible asset ratio to 6.67
        percent, $3.7 billion above the company's targeted ratio of
        5.50 percent.

    --  A reduction in the quarterly cash dividend rate on the
        company's common stock to 15 cents per share.

    --  A major expense reduction initiative projected to reduce 2008
        noninterest expense by $500 million to $8.0 billion or less.

    --  A significant acceleration in the strategic focus of our Home
        Loans business that emphasizes mortgage lending through our
        retail banking stores and other retail distribution channels.

The substantial infusion of new capital, dividend reduction, significant expense reductions, and the major change in our home loans business all combine to further fortify WaMu's strong capital and liquidity position."

Killinger added that the Retail Banking, Card Services and Commercial businesses delivered steady performance in 2007. In particular, the Retail Bank, which is the cornerstone of the franchise, continued its strong growth opening more than 1.1 million net new checking accounts for the year. The company plans to continue to leverage the Retail Bank's distribution network by opening additional stores and adding more than 1 million net new checking accounts in 2008.


FOURTH QUARTER AND FULL YEAR FINANCIAL SUMMARY AND HIGHLIGHTS
----------------------------------------------------------------------
Selected Financial
 Summary                 Three Months Ended            Year Ended
                   ------------------------------ --------------------
($ in millions,
 except per share  Dec. 31,   Sept. 30, Dec. 31,  Dec. 31,   Dec. 31,
 data)                2007       2007      2006      2007       2006
                   ---------- --------- --------- ---------- ---------
Income Statement
Net interest
 income            $  2,047   $  2,014  $  1,998  $  8,177   $  8,121
Provision for loan
 losses               1,534        967       344     3,107        816
Noninterest income    1,365      1,379     1,592     6,042      6,377
Noninterest
 expense              4,166      2,191     2,257    10,600      8,807
Minority interest
 expense                 65         53        34       203        105
                   ---------- --------- --------- ---------- ---------
Income (loss) from
 continuing
 operations before
 income taxes        (2,353)       182       955       309      4,770
Income taxes           (486)        (4)      315       376      1,656
                   ---------- --------- --------- ---------- ---------
Income (loss) from
 continuing
 operations          (1,867)       186       640       (67)     3,114
Discontinued
 operations               -          -       418         -        444
                   ---------- --------- --------- ---------- ---------
Net income (loss)  $ (1,867)  $    186  $  1,058  $    (67)  $  3,558

Diluted earnings
 (loss) per common
 share             $  (2.19)  $   0.20  $   1.10  $  (0.12)  $   3.64

Balance Sheet
Total assets, end
 of period         $327,913   $330,110  $346,288  $327,913   $346,288
Average total
 assets             325,276    320,475   353,056   323,389    348,758
Average interest-
 earning assets     287,988    283,263   314,784   286,666    312,178
Average total
 deposits           185,636    198,649   214,801   200,380    203,829

Profitability
 Ratios
Return on average
 common equity       (32.64)%     3.03%    16.03%    (0.42)%    13.52%
Net interest
 margin                2.85       2.86      2.58      2.85       2.60
Efficiency ratio     122.13      64.55     62.87     74.55      60.75
Nonperforming
 assets/total
 assets                2.17       1.65      0.80      2.17       0.80
Tangible
 equity/total
 tangible assets       6.67       5.60      6.04      6.67       6.04
----------------------------------------------------------------------
    --  Solid revenues and continued focus on expense control. Total
        revenue (net interest income plus noninterest income) of $3.41
        billion in the fourth quarter was solid, reflecting the
        strength of the franchise as evidenced by the company's strong
        net interest income and growth in fee income. Total revenue
        for the quarter was negatively impacted by continued
        illiquidity in the capital markets, resulting in reductions to
        noninterest income from net market valuation losses of $528
        million on the company's trading and available-for-sale
        securities portfolios. Fourth quarter noninterest expense,
        excluding the $1.78 billion pretax charge to writedown Home
        Loans goodwill, was $2.39 billion, up $200 million from the
        prior quarter due primarily to $143 million associated with
        the expense reduction steps announced in December. The company
        is projecting a $500 million reduction in 2008 noninterest
        expense to $8.0 billion or less.

    --  Net interest income remains strong. Net interest income has
        remained strong at approximately $2.0 billion per quarter over
        the past five quarters. During this period, the net interest
        margin has grown to 2.85 percent in the fourth quarter from
        2.58 percent in the fourth quarter of 2006. The growth in net
        interest margin more than offset an 8 percent decline in
        average interest-earning assets during a year in which the
        company sought to deemphasize balance sheet growth.

    --  Depositor and other retail banking fees up 13 percent
        year-over-year. During 2007, WaMu attracted over 1.1 million
        net new checking accounts, surpassing its goal for a second
        year of adding more than 1 million net new accounts per year.
        This growth, along with the company's success in building
        profitable customer relationships through superior service and
        cross sales, led to a 13 percent year-over-year increase in
        depositor and other retail banking fees.

    --  Noninterest income reflects continued disruption in the
        capital markets. Noninterest income of $1.37 billion in the
        fourth quarter continued to reflect the illiquidity in the
        capital markets. During the quarter, the company reported net
        losses of $267 million in the company's trading securities
        portfolio, which included a market valuation loss of $159
        million on credit card retained interests. The company also
        recognized a net loss of $261 million on its portfolio of
        securities designated as available for sale due to $271
        million of impairment losses on mortgage-backed securities.
        Noninterest income of $6.04 billion for 2007 was down 5
        percent from the prior year as disruption in the capital
        markets during the second half of 2007 more than offset the
        growth in fee income.

    --  Increase in loan loss provision reflects further weakening in
        housing market. The company's provision of $1.53 billion was
        within the most recently communicated guidance range of $1.5
        to $1.6 billion. This higher level of provisioning reflects
        the nationwide housing market weakness that has increased
        delinquencies and the level of charge-offs. During the
        quarter, net charge-offs of $747 million were also in line
        with guidance. The quarter's provision was approximately
        double the level of net charge-offs, bringing the allowance
        for loan losses to $2.57 billion at year end.

    --  Proactive expense management. During the fourth quarter, the
        company took steps to substantially adjust its Home Loans
        business due to its expectation that national mortgage
        originations will shrink to $1.5 trillion, down about 40% from
        2007. The resizing of the Home Loans business along with other
        reductions in corporate support functions resulted in $143
        million of additional fourth quarter noninterest expense. The
        company also incurred a fourth quarter pretax charge of $1.78
        billion for the writedown of all goodwill associated with the
        Home Loans Group. For 2007, noninterest expense of $8.83
        billion (which excludes the goodwill charge) was in line with
        the previous year, despite more stores and growth within the
        company.
FOURTH QUARTER AND FULL YEAR SEGMENT RESULTS
----------------------------------------------------------------------
Retail Banking Group

Selected Segment
 Information             Three Months Ended           Year Ended
                     --------------------------- ---------------------
(in millions, except
 accounts and        Dec. 31, Sept. 30, Dec. 31,   Dec. 31,   Dec. 31,
 households)            2007      2007     2006       2007       2006
                     -------- --------- -------- ---------- ----------
Net interest income  $  1,261  $  1,306 $  1,247 $    5,142 $    5,201
Provision for loan
 losses                   663       318       47      1,134        167
Noninterest income        850       833      774      3,254      2,914
Noninterest expense     1,215     1,150    1,098      4,567      4,364
Net income                278       456      563      1,874      2,288

Average loans        $145,486  $147,357 $172,013 $  149,409 $  177,401
Average retail
 deposits             142,733   144,921  143,513    144,233    140,344
Net change in number
 of retail
checking accounts      74,493   310,360  179,784  1,118,872  1,231,564
Net change in retail
 households            41,000   161,000  123,000    625,000    848,000
----------------------------------------------------------------------
    --  Solid performance offset by increase in provision. The Retail
        Bank has continued to perform well with a year over year 12
        percent increase in noninterest income that far exceeded the 5
        percent increase in noninterest expense. The increase in
        noninterest income was driven by the 13 percent growth in
        depositor and other retail banking fees. The modest year over
        year increase in noninterest expense reflected the company's
        investment in its retail banking network. The quarter's
        decline in net income reflected the increase in the provision
        for loan losses as the performance of the company's home loan
        and home equity loan portfolios remained under pressure from
        further deterioration in the housing market.

    --  Growth in net new checking accounts exceeds annual goal for
        second year. During 2007, the Retail Bank again exceeded its
        goal of adding more than 1 million net new checking accounts,
        growing the average balance of noninterest checking accounts
        by 7 percent year over year. WaMu's highly successful free
        checking account is the primary product for many consumers and
        provides the basis for cross sells and deepening customer
        relationships. This product has helped grow the number of
        households 7 percent year over year to just under 10 million.
        During the fourth quarter, the pace of checking account growth
        slowed due to normal seasonality and the closure of inactive
        accounts.
Card Services Group (managed basis)

Selected Segment
 Information                 Three Months Ended         Year Ended
                         --------------------------- -----------------
                         Dec. 31, Sept. 30, Dec. 31, Dec. 31, Dec. 31,
(in millions)               2007      2007     2006     2007     2006
                         -------- --------- -------- -------- --------
Net interest income      $   694   $   674  $   652  $ 2,659  $ 2,496
Provision for loan
 losses                      591       611      555    2,113    1,647
Noninterest income           315       400      451    1,581    1,528
Noninterest expense          338       364      318    1,337    1,205
Net income                    92        66      142      540      724

Average managed
 receivables             $26,665   $25,718  $22,875  $25,066  $21,294
Period end managed
 receivables              27,239    26,227   23,501   27,239   23,501
30+ day managed
 delinquency rate           6.47%     5.73%    5.25%    6.47%    5.25%
Managed net credit
 losses                     6.90      6.37     5.84     6.53     5.83
----------------------------------------------------------------------
    --  Solid performance impacted by capital markets disruption. Net
        income of $92 million was up from the third quarter, but still
        reflects the difficulty in the capital markets. Net interest
        income continued to grow with the increase in managed
        receivable balances, the benefit of which was partially offset
        by a decline in yields that reflects the lower Prime rate and
        higher proportion of better credit quality, but lower-yielding
        retail accounts. Included in fourth quarter noninterest income
        were market valuation losses of $159 million on the company's
        credit card retained interests. Included in third and fourth
        quarter noninterest expense were charges of $38 million and
        $50 million for VISA related litigation liabilities, which in
        the fourth quarter was partially offset by lower marketing
        expenses.

    --  Retail channel drives new account growth. Card Services
        continues to focus on WaMu's Retail Bank customers for new
        account growth and they accounted for 37 percent of the
        quarter's credit card account production, compared with 32
        percent in the third quarter and 28 percent a year ago. During
        the quarter, Card Services opened 653,000 new credit card
        accounts, or 292,000 less than in the third quarter,
        reflecting the selective reduction in marketing activities as
        the company places more emphasis on its retail channel. Strong
        customer acquisition contributed to the increase in year-end
        managed receivables to $27.24 billion, up 16 percent compared
        with the end of 2006.

    --  Credit losses in line with expectations. Net credit losses of
        6.90 percent of managed receivables were higher than in the
        third quarter and a year ago as the economy softened and
        unemployment levels increased. At 6.47 percent of period-end
        managed receivables, the 30+ day managed delinquency rate was
        also up from prior periods as delinquencies continue to rise
        from historically low levels. The year-over-year increase in
        the loan loss provision reflected the company's strong managed
        receivable growth and worsening credit trends.
Commercial Group

Selected Segment
 Information                 Three Months Ended         Year Ended
                         --------------------------- -----------------
                         Dec. 31, Sept. 30, Dec. 31, Dec. 31, Dec. 31,
(in millions)               2007      2007     2006     2007     2006
                         -------- --------- -------- -------- --------
Net interest income      $   200   $   200  $   201   $   820 $   719
Provision for loan
 losses                       19        12      (70)       24     (82)
Noninterest income           (10)      (34)      41        35      99
Noninterest expense           66        67       73       282     259
Net income                    94        58      148       375     396

Loan volume              $ 4,800   $ 4,054  $ 4,019   $16,873 $12,854
Average loans             40,129    38,333   37,552    38,975  33,230
------------------------ ---------------------------------------------
    --  Solid quarterly results. Net income of $94 million was up from
        $58 million in the third quarter with the improvement in
        noninterest income. Gain on sale, net of hedging, improved
        from the third quarter, but is still far below 2006 levels.
        For the full year, noninterest income was down due to lower
        gain on sale, as well as losses on the valuation of assets.
        The increase in noninterest expense for the full year was
        primarily due to a 31 percent increase in loan volumes. The
        increase in the provision from the prior quarter reflected the
        strong loan growth. The provision in the fourth quarter of
        2006 included a $60 million reduction in the allowance related
        to refinements in the company's estimate of the allowance
        attributable to multi-family loans.

    --  Loan volume continues to be strong. During the fourth quarter,
        loan volume of $4.8 billion was up 18 percent from the prior
        quarter and up 19 percent from a year ago. Full year loan
        volume of $16.87 billion was up 31 percent with growth in both
        multi-family and nonresidential lending. The growth in
        multi-family lending was driven by the acquisition of
        Commercial Capital Bancorp in 2006 and the growth in existing
        markets, as well as entry into new markets. Other commercial
        real estate lending continued to benefit from leveraging the
        existing multi-family footprint.
Home Loans Group

Selected Segment
 Information               Three Months Ended          Year Ended
                       --------------------------- -------------------
                       Dec. 31, Sept. 30, Dec. 31,  Dec. 31,  Dec. 31,
(in millions)             2007      2007     2006      2007      2006
                       -------- --------- -------- --------- ---------
Net interest income    $   230   $   191  $   270  $    878  $  1,165
Provision for loan
 losses                    511       323       47       985       189
Noninterest income         329       183      125     1,061     1,296
Noninterest expense      2,319       553      533     3,939     2,295
Net (loss)              (1,964)     (342)    (124)   (2,460)      (50)

Loan volume            $19,089   $26,434  $37,532  $115,241  $171,569
Average loans           52,278    43,737   51,048    48,131    47,586
----------------------------------------------------------------------
    --  Results impacted by goodwill charge and increased credit
        costs. Home Loans reported a fourth quarter loss of $1.96
        billion, up from a loss of $342 million in the third quarter
        as mortgage market conditions continued to deteriorate. The
        Home Loans segment wrote off all goodwill on its balance
        sheet, which resulted in a pretax charge to noninterest
        expense of $1.78 billion. Additionally, increasing levels of
        subprime delinquencies and charge-offs drove the loan loss
        provision $188 million higher than in the prior quarter. Net
        interest income was up from the third quarter as loan balances
        increased due to retention of nonconforming loan production in
        the segment's portfolio. Noninterest income was up due to
        favorable gain on sale compared with the third quarter as that
        quarter included mark to market valuation losses on loans
        transferred to portfolio. Expenses (excluding the goodwill
        charge) were down slightly reflecting third quarter staffing
        reductions and lower production related costs with the reduced
        amount of lending. Actions taken in the fourth quarter to
        resize the Home Loans' business included elimination of
        approximately 2,600 positions, closure of approximately 190
        home loan centers and sales offices and closure of 9 loan
        processing and call centers.

    --  Home loan volume reflects distressed housing market. Fourth
        quarter loan volume of $19.09 billion was down 28 percent from
        the third quarter. During the fourth quarter, the company
        discontinued all remaining lending through its subprime
        mortgage channel.

    COMPANY UPDATES

    --  On Dec. 12, WaMu priced a public offering of 3,000,000 shares
        of 7.75% Series R Non-Cumulative Perpetual Convertible
        Preferred Stock with a liquidation preference of $1,000 per
        share, resulting in an aggregate liquidation preference of
        $3.0 billion. Each share of series R Preferred Stock will pay,
        when and if declared by the company's board of directors,
        dividends in cash at a rate of 7.75% per annum, payable
        quarterly. The first dividend payment date will be Mar. 17,
        2008.

    --  On Jan. 15, WaMu's Board of Directors declared a cash dividend
        of 15 cents per share on the company's common stock. Dividends
        on the common stock are payable on Feb. 15, 2008 to
        shareholders of record as of Jan. 31, 2008. In addition to
        declaring a dividend on the company's common stock, the
        company will pay a dividend of $0.3596 per depository share of
        Series K Preferred Stock to be payable on Mar. 17, 2008 to
        holders of record on Mar. 3, 2008 and a dividend of $19.1597
        per share of Series R Preferred Stock to be payable on Mar.
        17, 2008 to holders of record on Mar. 3, 2008.

    ABOUT WAMU

WaMu, through its subsidiaries, is one of the nation's leading consumer and small business banks. At Dec. 31, 2007, WaMu and its subsidiaries had assets of $327.91 billion. The company has a history dating back to 1889 and its subsidiary banks currently operate approximately 2,500 consumer and small business banking stores throughout the nation. WaMu's financial reports and news releases are available at www.wamu.com/ir.

WEBCAST INFORMATION

A conference call to discuss the company's financial results will be held on Thursday, Jan. 17, 2008, at 5:00 p.m. ET and will be hosted by Kerry Killinger, chairman and chief executive officer and Tom Casey, executive vice president and chief financial officer. The conference call is available by telephone or on the Internet. The dial-in number for the live conference call is 888-391-7808. Participants calling from outside the United States may dial 210-234-0002. The passcode "WaMu" is required to access the call. Via the Internet, the conference call is available on the Investor Relations portion of the company's web site at www.wamu.com/ir. A transcript of the prepared remarks will be available on the company's web site prior to the call and archived for at least 30 days. A recording of the conference call will be available from 7:00 p.m. ET on Thursday, Jan. 17, 2008, through 11:59 p.m. ET on Wednesday, Jan. 30, 2008. The recorded message will be available at 800-395-7443. Callers from outside the United States may dial 203-369-3271.

CAUTIONARY STATEMENTS

This presentation contains forward-looking statements, which are not historical facts and pertain to future operating results. These forward-looking statements are within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, statements about our plans, objectives, expectations and intentions and other statements contained in this document that are not historical facts. When used in this presentation, the words "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates," or words of similar meaning, or future or conditional verbs, such as "will," "would," "should," "could," or "may" are generally intended to identify forward-looking statements. These forward-looking statements are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. Actual results may differ materially from the results discussed in these forward-looking statements for the reasons, among others, discussed under the heading "Factors That May Affect Future Results" in Washington Mutual's 2006 Annual Report on Form 10-K and "Cautionary Statements" in our Forms 10-Q for the quarters ended March 31, 2007, June 30, 2007 and September 30, 2007 which include:

    --  Volatile interest rates and their impact on the mortgage
        banking business;

    --  Credit risk;

    --  Operational risk;

    --  Risks related to credit card operations;

    --  Changes in the regulation of financial services companies,
        housing government-sponsored enterprises and credit card
        lenders;

    --  Competition from banking and nonbanking companies;

    --  General business, economic and market conditions;

    --  Reputational risk;

    --  Liquidity risk; and

    --  Valuation risk.

There are other factors not described in our 2006 Form 10-K and Forms 10-Q for the quarters ended March 31, 2007, June 30, 2007 and September 30, 2007 which are beyond the Company's ability to anticipate or control that could cause results to differ.

WM-1
                       Washington Mutual, Inc.
                    Selected Financial Information
             (dollars in millions, except per share data)
                             (unaudited)

                                    Quarter Ended
---------------------------------------------------------------------
                    Dec. 31, Sept. 30,  June 30,  Mar. 31,  Dec. 31,
                       2007      2007      2007      2007      2006
---------------------------------------------------------------------
PROFITABILITY
  Net income
   (loss)          $ (1,867) $    186  $    830  $    784  $  1,058
  Net interest
   income             2,047     2,014     2,034     2,081     1,998
  Noninterest
   income             1,365     1,379     1,758     1,541     1,592
  Noninterest
   expense            4,166     2,191     2,138     2,105     2,257

  Diluted earnings
   per common
   share:
    Income (loss)
     from
     continuing
     operations    $  (2.19) $   0.20  $   0.92  $   0.86  $   0.66
    Income from
     discontinued
     operations           -         -         -         -      0.44
    Net income
     (loss)           (2.19)     0.20      0.92      0.86      1.10

  Diluted weighted
   average number
   of common
   shares
   outstanding
  (in thousands)    855,532   876,002   893,090   899,706   955,817
  Net interest
   margin              2.85 %    2.86 %    2.90 %    2.79 %    2.58 %
  Dividends
   declared per
   common share    $   0.56  $   0.56  $   0.55  $   0.54  $   0.53
  Book value per
   common share
   (period end)(1)    24.55     27.18     27.27     27.30     28.21
  Return on
   average assets     (2.30)%    0.23 %    1.05 %    0.95 %    1.20 %
  Return on
   average common
   equity            (32.64)     3.03     13.74     12.99     16.03
  Efficiency
   ratio(2)(3)       122.13     64.55     56.38     58.13     62.87

ASSET QUALITY
  Nonperforming
   assets(4) to
   total assets        2.17 %    1.65 %    1.29 %    1.02 %    0.80 %
  Allowance as a
   percentage of
   loans held in
   portfolio           1.05      0.80      0.73      0.71      0.72

CREDIT PERFORMANCE
  Provision for
   loan losses     $  1,534  $    967  $    372  $    234  $    344
  Net charge-offs       747       421       271       183       136

CAPITAL ADEQUACY
  Capital Ratios
   for WMI:
    Tangible
     equity to
     total
     tangible
     assets(5)         6.67 %    5.60 %    6.07 %    5.78 %    6.04 %
    Tier 1 capital
     to average
     total
     assets(6)         6.84      5.86      6.09      5.87      6.35
    Total risk-
     based capital
     to total
     risk-weighted
     assets(6)        12.35     10.67     11.04     11.17     11.77
  Capital Ratios
   for WMB (well-
   capitalized
   minimum)(7):
    Tier 1 capital
     to adjusted
     total assets
     (5.00%)           7.02      6.41      7.52      7.04      7.10
    Adjusted Tier
     1 capital to
     total risk-
     weighted
     assets
     (6.00%)           8.25      7.62      8.77      8.32      8.69
    Total risk-
     based capital
     to total
     risk-weighted
     assets
     (10.00%)         12.12     11.26     12.80     12.37     12.56

SUPPLEMENTAL DATA
  Average balance
   sheet:
    Total loans
     held in
     portfolio     $241,690  $227,348  $216,004  $222,617  $239,265
    Total
     interest-
     earning
     assets(2)      287,988   283,263   279,836   295,700   314,784
    Total assets    325,276   320,475   316,004   331,905   353,056
    Total deposits  185,636   198,649   206,765   210,764   214,801
    Total
     stockholders'
     equity          23,947    23,994    24,436    24,407    26,700
  Period-end
   balance sheet:
    Total loans
     held in
     portfolio,
     net            241,815   235,243   213,434   215,481   223,330
    Total assets    327,913   330,110   312,219   319,985   346,288
    Total deposits  181,926   194,280   201,380   210,209   213,956
    Total
     stockholders'
     equity          24,584    23,941    24,210    24,578    26,969
    Common shares
     outstanding
     at the end of
     period (in
     thousands)(8)  869,036   868,802   875,722   888,111   944,479
    Employees at
     end of period   49,403    49,748    49,989    49,693    49,824

                       Year Ended
--------------------------------------
                    Dec. 31,  Dec. 31,
                       2007      2006
--------------------------------------
PROFITABILITY
  Net income
   (loss)          $    (67) $  3,558
  Net interest
   income             8,177     8,121
  Noninterest
   income             6,042     6,377
  Noninterest
   expense           10,600     8,807

  Diluted earnings
   per common
   share:
    Income (loss)
     from
     continuing
     operations    $  (0.12) $   3.18
    Income from
     discontinued
     operations           -      0.46
    Net income
     (loss)           (0.12)     3.64

  Diluted weighted
   average number
   of common
   shares
   outstanding
  (in thousands)    866,183   975,406
  Net interest
   margin              2.85 %    2.60 %
  Dividends
   declared per
   common share    $   2.21  $   2.06
  Book value per
   common share
   (period end)(1)    24.55     28.21
  Return on
   average assets     (0.02)%    1.02 %
  Return on
   average common
   equity             (0.42)    13.52
  Efficiency
   ratio(2)(3)        74.55     60.75

ASSET QUALITY
  Nonperforming
   assets(4) to
   total assets        2.17 %    0.80 %
  Allowance as a
   percentage of
   loans held in
   portfolio           1.05      0.72

CREDIT PERFORMANCE
  Provision for
   loan losses     $  3,107  $    816
  Net charge-offs     1,623       510

CAPITAL ADEQUACY
  Capital Ratios
   for WMI:
    Tangible
     equity to
     total
     tangible
     assets(5)         6.67 %    6.04 %
    Tier 1 capital
     to average
     total
     assets(6)         6.84      6.35
    Total risk-
     based capital
     to total
     risk-weighted
     assets(6)        12.35     11.77
  Capital Ratios
   for WMB (well-
   capitalized
   minimum)(7):
    Tier 1 capital
     to adjusted
     total assets
     (5.00%)           7.02      7.10
    Adjusted Tier
     1 capital to
     total risk-
     weighted
     assets
     (6.00%)           8.25      8.69
    Total risk-
     based capital
     to total
     risk-weighted
     assets
     (10.00%)         12.12     12.56

SUPPLEMENTAL DATA
  Average balance
   sheet:
    Total loans
     held in
     portfolio     $226,968  $239,094
    Total
     interest-
     earning
     assets(2)      286,666   312,178
    Total assets    323,389   348,758
    Total deposits  200,380   203,829
    Total
     stockholders'
     equity          24,194    26,406
  Period-end
   balance sheet:
    Total loans
     held in
     portfolio,
     net            241,815   223,330
    Total assets    327,913   346,288
    Total deposits  181,926   213,956
    Total
     stockholders'
     equity          24,584    26,969
    Common shares
     outstanding
     at the end of
     period (in
     thousands)(8)  869,036   944,479
    Employees at
     end of period   49,403    49,824

_______________________
(1) Excludes six million shares held in escrow.

(2) Based on continuing operations.

(3) The efficiency ratio is defined as noninterest expense divided by
     total revenue (net interest income and noninterest income).

(4) Excludes nonaccrual loans held for sale.

(5) Excludes unrealized net gain/loss on available-for-sale securities
     and cash flow hedging instruments, goodwill and intangible assets
     (except MSR) and the impact from the adoption and application of
     FASB Statement No. 158, Employers' Accounting for Defined Benefit
     Pension and Other Postretirement Plans. Minority interests of
     $3.92 billion for December 31, 2007, $2.94 billion for September
     30, 2007 and June 30, 2007, and $2.45 billion for March 31, 2007
     and December 31, 2006 are included in the numerator.

(6) The capital ratios are estimated as if Washington Mutual, Inc.
     were a bank holding company subject to Federal Reserve Board
     capital requirements.

(7) Capital ratios for Washington Mutual Bank ("WMB") at December 31,
     2007 are preliminary.

(8) Includes six million shares held in escrow.
WM-2
                       Washington Mutual, Inc.
                  Consolidated Statements of Income
             (dollars in millions, except per share data)
                             (unaudited)

                                       Quarter Ended
----------------------------------------------------------------------
                      Dec. 31, Sept. 30,  June 30,  Mar. 31,  Dec. 31,
                         2007      2007      2007      2007      2006
----------------------------------------------------------------------
Interest Income
  Loans held for
   sale              $    160  $    248  $    421  $    562  $    515
  Loans held in
   portfolio            4,156     3,992     3,786     3,900     4,053
  Available-for-sale
   securities             380       392       351       332       392
  Trading assets          101       108       108       113       102
  Other interest and
   dividend income         79       116        82       101       148
----------------------------------------------------------------------
    Total interest
     income             4,876     4,856     4,748     5,008     5,210
Interest Expense
  Deposits              1,464     1,650     1,723     1,772     1,843
  Borrowings            1,365     1,192       991     1,155     1,369
----------------------------------------------------------------------
    Total interest
     expense            2,829     2,842     2,714     2,927     3,212
----------------------------------------------------------------------
     Net interest
      income            2,047     2,014     2,034     2,081     1,998
  Provision for loan
   losses               1,534       967       372       234       344
----------------------------------------------------------------------
     Net interest
      income after
      provision for
      loan losses         513     1,047     1,662     1,847     1,654
Noninterest Income
  Revenue from sales
   and servicing of
   home mortgage
   loans                  358       161       300       125       164
  Revenue from sales
   and servicing of
   consumer loans         375       418       403       443       372
  Depositor and
   other retail
   banking fees           769       740       720       665       692
  Credit card fees        214       209       183       172       182
  Securities fees
   and commissions         63        67        70        60        54
  Insurance income         29        29        29        29        30
  Loss on trading
   assets                (267)     (153)     (145)     (108)      (81)
  Gain (loss) on
   other available-
   for-sale
   securities            (261)      (99)        7        35        (1)
  Other income             85         7       191       120       180
----------------------------------------------------------------------
    Total
     noninterest
     income             1,365     1,379     1,758     1,541     1,592
Noninterest Expense
  Compensation and
   benefits               877       910       977     1,002       945
  Occupancy and
   equipment              488       371       354       376       476
  Telecommunications
   and outsourced
   information
   services               134       135       132       129       133
  Depositor and
   other retail
   banking losses          72        71        58        61        64
  Advertising and
   promotion              108       125       113        98       107
  Professional fees        89        52        55        38        89
  Foreclosed asset
   expense                133        82        56        39        34
  Goodwill
   impairment charge    1,775         -         -         -         -
  Other expense           490       445       393       362       409
----------------------------------------------------------------------
    Total
     noninterest
     expense            4,166     2,191     2,138     2,105     2,257
  Minority interest
   expense                 65        53        42        43        34
----------------------------------------------------------------------
     Income (loss)
      from
      continuing
      operations
      before income
      taxes            (2,353)      182     1,240     1,240       955
     Income taxes        (486)       (4)      410       456       315
----------------------------------------------------------------------
       Income (loss)
        from
        continuing
        operations     (1,867)      186       830       784       640
----------------------------------------------------------------------
Discontinued
 Operations(1)
     Income from
      discontinued
      operations
      before income
      taxes                 -         -         -         -         2
     Gain on
      disposition of
      discontinued
      operations            -         -         -         -       667
     Income taxes           -         -         -         -       251
----------------------------------------------------------------------
       Income from
        discontinued
        operations          -         -         -         -       418
----------------------------------------------------------------------
Net Income (Loss)    $ (1,867) $    186  $    830  $    784  $  1,058
======================================================================
Net Income (Loss)
 Applicable to
 Common Stockholders $ (1,875) $    178  $    822  $    777  $  1,050
======================================================================

Basic Earnings Per
 Common Share:
  Income (loss) from
   continuing
   operations        $  (2.19) $   0.21  $   0.95  $   0.89  $   0.68
  Income from
   discontinued
   operations               -         -         -         -      0.45
                     --------- --------- --------- --------- ---------
    Net Income
     (Loss)             (2.19)     0.21      0.95      0.89      1.13

Diluted Earnings Per
 Common Share:
  Income (loss) from
   continuing
   operations        $  (2.19) $   0.20  $   0.92  $   0.86  $   0.66
  Income from
   discontinued
   operations               -         -         -         -      0.44
                     --------- --------- --------- --------- ---------
    Net Income
     (Loss)             (2.19)     0.20      0.92      0.86      1.10

Dividends declared
 per common share        0.56      0.56      0.55      0.54      0.53
Basic weighted
 average number of
 common shares
 outstanding (in
 thousands)           855,518   857,005   868,968   874,816   931,484
Diluted weighted
 average number of
 common shares
 outstanding (in
 thousands)           855,532   876,002   893,090   899,706   955,817
____________________

(1) Represents WM Advisors, Inc., the Company's retail mutual fund
     management business, which was sold in the fourth quarter of
     2006.
WM-3
                       Washington Mutual, Inc.
                  Consolidated Statements of Income
             (dollars in millions, except per share data)
                             (unaudited)

                                                       Year Ended
----------------------------------------------------------------------
                                                    Dec. 31,  Dec. 31,
                                                       2007      2006
----------------------------------------------------------------------
Interest Income
  Loans held for sale                              $  1,391  $  1,807
  Loans held in portfolio                            15,835    15,533
  Available-for-sale securities                       1,455     1,460
  Trading assets                                        430       606
  Other interest and dividend income                    378       501
----------------------------------------------------------------------
    Total interest income                            19,489    19,907
Interest Expense
  Deposits                                            6,610     6,263
  Borrowings                                          4,702     5,523
----------------------------------------------------------------------
    Total interest expense                           11,312    11,786
----------------------------------------------------------------------
      Net interest income                             8,177     8,121
  Provision for loan losses                           3,107       816
----------------------------------------------------------------------
      Net interest income after provision for loan
       losses                                         5,070     7,305
Noninterest Income
  Revenue from sales and servicing of home
   mortgage loans                                       944       768
  Revenue from sales and servicing of consumer
   loans                                              1,639     1,527
  Depositor and other retail banking fees             2,893     2,567
  Credit card fees                                      778       637
  Securities fees and commissions                       260       215
  Insurance income                                      116       127
  Loss on trading assets                               (673)     (154)
  Loss on other available-for-sale securities          (319)       (9)
  Other income                                          404       699
----------------------------------------------------------------------
    Total noninterest income                          6,042     6,377
Noninterest Expense
  Compensation and benefits                           3,766     3,937
  Occupancy and equipment                             1,589     1,711
  Telecommunications and outsourced information
   services                                             530       554
  Depositor and other retail banking losses             262       229
  Advertising and promotion                             445       443
  Professional fees                                     233       227
  Foreclosed asset expense                              309       117
  Goodwill impairment charge                          1,775         -
  Other expense                                       1,691     1,589
----------------------------------------------------------------------
    Total noninterest expense                        10,600     8,807
  Minority interest expense                             203       105
----------------------------------------------------------------------
       Income from continuing operations before
        income taxes                                    309     4,770
       Income taxes                                     376     1,656
----------------------------------------------------------------------
         Income (loss) from continuing operations       (67)    3,114
----------------------------------------------------------------------
Discontinued Operations(1)
       Income from discontinued operations before
        income taxes                                      -        42
       Gain on disposition of discontinued
        operations                                        -       667
       Income taxes                                       -       265
----------------------------------------------------------------------
         Income from discontinued operations              -       444
----------------------------------------------------------------------
Net Income (Loss)                                  $    (67) $  3,558
======================================================================
Net Income (Loss) Applicable to Common
 Stockholders                                      $    (98) $  3,550
======================================================================

Basic Earnings Per Common Share:
  Income (loss) from continuing operations         $  (0.11) $   3.27
  Income from discontinued operations                     -      0.47
                                                   --------- ---------
    Net Income (Loss)                                 (0.11)     3.74

Diluted Earnings Per Common Share:
  Income (loss) from continuing operations         $  (0.12) $   3.18
  Income from discontinued operations                     -      0.46
                                                   --------- ---------
    Net Income (Loss)                                 (0.12)     3.64

Dividends declared per common share                    2.21      2.06
Basic weighted average number of common shares
 outstanding (in thousands)                         864,004   948,371
Diluted weighted average number of common shares
 outstanding (in thousands)                         866,183   975,406
___________________

(1) Represents WM Advisors, Inc., the Company's retail mutual fund
     management business, which was sold in the fourth quarter of
     2006.
WM-4
                       Washington Mutual, Inc.
            Consolidated Statements of Financial Condition
                        (dollars in millions)
                             (unaudited)

                      Dec. 31, Sept. 30,  June 30,  Mar. 31,  Dec. 31,
                         2007      2007      2007      2007      2006
----------------------------------------------------------------------
Assets
  Cash and cash
   equivalents       $  9,560  $ 11,370  $  4,167  $  4,047  $  6,948
  Federal funds sold
   and securities
   purchased under
   agreements to
   resell               1,877     4,042     3,267     8,279     3,743
  Trading assets        2,768     3,797     5,534     5,290     4,434
  Available-for-sale
   securities, total
   amortized cost of
   $27,789, $28,725,
   $28,934, $22,921,
   and $25,073:
    Mortgage-backed
     securities        19,249    20,562    20,393    16,543    18,601
    Investment
     securities         8,291     7,844     7,947     6,296     6,377
----------------------------------------------------------------------
      Total
       available-
       for-sale
       securities      27,540    28,406    28,340    22,839    24,978
  Loans held for
   sale                 5,403     7,586    19,327    26,874    44,970
  Loans held in
   portfolio          244,386   237,132   214,994   217,021   224,960
  Allowance for loan
   losses              (2,571)   (1,889)   (1,560)   (1,540)   (1,630)
----------------------------------------------------------------------
      Loans held in
       portfolio,
       net            241,815   235,243   213,434   215,481   223,330
  Investment in
   Federal Home Loan
   Banks                3,351     2,808     1,596     2,230     2,705
  Mortgage servicing
   rights               6,278     6,794     7,231     6,507     6,193
  Goodwill              7,287     9,062     9,056     9,052     9,050
  Other assets         22,034    21,002    20,267    19,386    19,937
----------------------------------------------------------------------
      Total assets   $327,913  $330,110  $312,219  $319,985  $346,288
======================================================================
Liabilities
  Deposits:
    Noninterest-
     bearing
     deposits        $ 30,389  $ 31,341  $ 33,557  $ 34,367  $ 33,386
    Interest-bearing
     deposits         151,537   162,939   167,823   175,842   180,570
----------------------------------------------------------------------
      Total deposits  181,926   194,280   201,380   210,209   213,956
  Federal funds
   purchased and
   commercial paper     2,003     2,482     3,390       563     4,778
  Securities sold
   under agreements
   to repurchase        4,148     4,732     9,357     8,323    11,953
  Advances from
   Federal Home Loan
   Banks               63,852    52,530    21,412    24,735    44,297
  Other borrowings     38,958    40,887    40,313    39,430    32,852
  Other liabilities     8,523     8,313     9,212     9,694     9,035
  Minority interests    3,919     2,945     2,945     2,453     2,448
----------------------------------------------------------------------
      Total
       liabilities    303,329   306,169   288,009   295,407   319,319
Stockholders' equity
  Preferred stock       3,392       492       492       492       492
  Capital surplus -
   common stock         2,630     2,575     2,715     3,121     5,825
  Accumulated other
   comprehensive
   loss                  (359)     (390)     (568)     (268)     (287)
  Retained earnings    18,921    21,264    21,571    21,233    20,939
----------------------------------------------------------------------
      Total
       stockholders'
       equity          24,584    23,941    24,210    24,578    26,969
----------------------------------------------------------------------
      Total
       liabilities
       and
       stockholders'
       equity        $327,913  $330,110  $312,219  $319,985  $346,288
======================================================================
WM-5
                       Washington Mutual, Inc.
                    Selected Financial Information
                        (dollars in millions)
                             (unaudited)

                                     Quarter Ended
-------------------------------------------------------------------
                    Dec. 31, Sept. 30, June 30, Mar. 31,   Dec. 31,
                       2007      2007     2007     2007       2006
-------------------------------------------------------------------
Stockholders'
 Equity Rollforward
Balance, beginning
 of period          $23,941   $24,210  $24,578  $26,969    $26,458
Net income (loss)    (1,867)      186      830      784      1,058
Cumulative effect
 from the adoption
 of new accounting
 pronouncements           -         -        -       (6)(1)   (157)(2)
Other comprehensive
 income (loss), net
 of income taxes         31       177     (300)      19         50
Cash dividends
 declared on common
 stock                 (482)     (485)    (484)    (476)      (496)
Cash dividends
 declared on
 preferred stock         (8)       (8)      (8)      (7)        (8)
Cash dividends
 returned(3)             15         -        -        -          -
Common stock
 repurchased and
 retired(4)               -      (199)    (500)  (2,797)         -
Common stock issued      54        60       94       92         64
Preferred stock
 issued               2,900         -        -        -          -
-------------------------------------------------------------------
Balance, end of
 period             $24,584   $23,941  $24,210  $24,578    $26,969
===================================================================

(1) As of January 1, 2007, the Company adopted FASB Interpretation
     No. 48, Accounting for Uncertainty in Income Taxes.

(2) On December 31, 2006, the Company adopted Statement of Financial
     Accounting Standards ("Statement") No. 158, Employers' Accounting
     for Defined Benefit Pension and Other Postretirement Plans.
     Statement No. 158 requires an entity to recognize the overfunded
     or underfunded status of its defined benefit postretirement plans
     as an asset or liability in its statement of financial condition
     and to recognize changes, through comprehensive income, in that
     funded status in the year in which the changes occur. The
     cumulative effects, net of income taxes, resulted in a $274
     million decrease to December 31, 2006 other assets and a $117
     million decrease to December 31, 2006 other liabilities.

(3) Represents accumulated dividends on shares returned from escrow.

(4) The Company repurchased zero, 7.2 million, 13.5 million, 61.4
     million and 1.7 million shares of its common stock during the
     three months ended December 31, 2007, September 30, 2007, June
     30, 2007, March 31, 2007 and December 31, 2006. At December 31,
     2007, the total remaining common stock repurchase authority was
     47.5 million shares.
WM-6
                       Washington Mutual, Inc.
                    Selected Financial Information
                        (dollars in millions)
                             (unaudited)


                                      Quarter Ended
----------------------------------------------------------------------
                     Dec. 31, Sept. 30,  June 30,  Mar. 31,  Dec. 31,
                        2007      2007      2007      2007      2006
----------------------------------------------------------------------
RETAIL BANKING
 GROUP
  Condensed income
   statement:
    Net interest
     income         $  1,261  $  1,306  $  1,291  $  1,284  $  1,247
    Provision for
     loan losses         663       318        91        62        47
    Noninterest
     income              850       833       820       751       774
    Inter-segment
     revenue               5         9        16        18        15
    Noninterest
     expense           1,215     1,150     1,132     1,070     1,098
----------------------------------------------------------------------
    Income from
     continuing
     operations
     before income
     taxes               238       680       904       921       891
    Income taxes         (40)      224       339       346       340
----------------------------------------------------------------------
      Income from
       continuing
       operations        278       456       565       575       551
      Income from
       discontinued
       operations          -         -         -         -        12
----------------------------------------------------------------------
        Net income  $    278  $    456  $    565  $    575  $    563
======================================================================
  Performance and
   other data:
    Efficiency
     ratio             57.40%    53.53%    53.24%    52.13%    53.95%
    Average loans   $145,486  $147,357  $149,716  $155,206  $172,013
    Average assets   155,103   157,196   159,518   165,047   182,240
    Average
     deposits:
      Checking
       deposits:
      Noninterest
       bearing        22,748    22,860    23,107    22,331    21,873
      Interest
       bearing        26,328    28,406    30,282    31,739    33,010
----------------------------------------------------------------------
      Total
       checking
       deposits       49,076    51,266    53,389    54,070    54,883
      Savings and
       money market
       deposits       44,623    43,524    43,814    43,103    41,442
      Time deposits   49,034    50,131    48,049    46,857    47,188
----------------------------------------------------------------------
        Average
         deposits    142,733   144,921   145,252   144,030   143,513
    Loan volume        3,417     5,172     5,760     4,576     4,154
    Employees at
     end of period    28,784    28,263    28,131    27,837    27,629
CARD SERVICES GROUP

 Managed basis(1)
  Condensed income
   statement:
    Net interest
     income         $    694  $    674  $    649  $    641  $    652
    Provision for
     loan losses         591       611       523       388       555
    Noninterest
     income              315       400       393       474       451
    Noninterest
     expense             338       364       306       329       318
----------------------------------------------------------------------
    Income before
     income taxes         80        99       213       398       230
    Income taxes         (12)       33        80       149        88
----------------------------------------------------------------------
      Net income    $     92  $     66  $    133  $    249  $    142
======================================================================
  Performance and
   other data:
    Efficiency
     ratio             33.51%    33.91%    29.33%    29.51%    28.83%
    Average loans   $ 26,665  $ 25,718  $ 24,234  $ 23,604  $ 22,875
    Average assets    28,961    28,206    26,762    26,039    25,472
    Employees at
     end of period     2,860     2,878     2,827     2,579     2,611

 Securitization
  adjustments
  Condensed income
   statement:
    Net interest
     income         $   (454) $   (456) $   (459) $   (414) $   (437)
    Provision for
     loan losses        (335)     (288)     (294)     (282)     (280)
    Noninterest
     income              119       168       165       132       157
  Performance and
   other data:
    Average loans    (16,007)  (14,488)  (13,888)  (12,507)  (12,811)
    Average assets   (14,180)  (12,841)  (12,287)  (10,961)  (11,035)

 Adjusted basis
  Condensed income
   statement:
    Net interest
     income         $    240  $    218  $    190  $    227  $    215
    Provision for
     loan losses         256       323       229       106       275
    Noninterest
     income              434       568       558       606       608
    Noninterest
     expense             338       364       306       329       318
----------------------------------------------------------------------
    Income before
     income taxes         80        99       213       398       230
    Income taxes         (12)       33        80       149        88
----------------------------------------------------------------------
      Net income    $     92  $     66  $    133  $    249  $    142
======================================================================
  Performance and
   other data:
    Average loans   $ 10,658  $ 11,230  $ 10,346  $ 11,097  $ 10,064
    Average assets    14,781    15,365    14,475    15,078    14,437



                               Year Ended
----------------------------------------------
                            Dec. 31,  Dec. 31,
                               2007      2006
----------------------------------------------
RETAIL BANKING
 GROUP
  Condensed income
   statement:
    Net interest
     income                $  5,142  $  5,201
    Provision for
     loan losses              1,134       167
    Noninterest
     income                   3,254     2,914
    Inter-segment
     revenue                     48        58
    Noninterest
     expense                  4,567     4,364
----------------------------------------------
    Income from
     continuing
     operations
     before income
     taxes                    2,743     3,642
    Income taxes                869     1,392
----------------------------------------------
      Income from
       continuing
       operations             1,874     2,250
      Income from
       discontinued
       operations                 -        38
----------------------------------------------
        Net income         $  1,874  $  2,288
==============================================
  Performance and
   other data:
    Efficiency
     ratio                    54.09%    53.39%
    Average loans          $149,409  $177,401
    Average assets          159,184   187,735
    Average
     deposits:
      Checking
       deposits:
      Noninterest
       bearing               22,763    21,274
      Interest
       bearing               29,169    36,391
----------------------------------------------
      Total
       checking
       deposits              51,932    57,665
      Savings and
       money market
       deposits              43,769    38,843
      Time deposits          48,532    43,836
----------------------------------------------
        Average
         deposits           144,233   140,344
    Loan volume              18,926    20,354
    Employees at
     end of period           28,784    27,629
CARD SERVICES GROUP

 Managed basis(1)
  Condensed income
   statement:
    Net interest
     income                $  2,659  $  2,496
    Provision for
     loan losses              2,113     1,647
    Noninterest
     income                   1,581     1,528
    Noninterest
     expense                  1,337     1,205
----------------------------------------------
    Income before
     income taxes               790     1,172
    Income taxes                250       448
----------------------------------------------
      Net income           $    540  $    724
==============================================
  Performance and
   other data:
    Efficiency
     ratio                    31.53%    29.96%
    Average loans          $ 25,066  $ 21,294
    Average assets           27,502    23,888
    Employees at
     end of period            2,860     2,611

 Securitization
  adjustments
  Condensed income
   statement:
    Net interest
     income                $ (1,783) $ (1,686)
    Provision for
     loan losses             (1,200)     (943)
    Noninterest
     income                     583       743
  Performance and
   other data:
    Average loans           (14,233)  (12,165)
    Average assets          (12,577)  (10,337)

 Adjusted basis
  Condensed income
   statement:
    Net interest
     income                $    876  $    810
    Provision for
     loan losses                913       704
    Noninterest
     income                   2,164     2,271
    Noninterest
     expense                  1,337     1,205
----------------------------------------------
    Income before
     income taxes               790     1,172
    Income taxes                250       448
----------------------------------------------
      Net income           $    540  $    724
==============================================
  Performance and
   other data:
    Average loans          $ 10,833  $  9,129
    Average assets           14,925    13,551


(This table is continued on "WM-7.")
__________________________
(1) The managed basis presentation treats securitized and sold credit
     card receivables as if they were still on the balance sheet. The
     Company uses this basis in assessing the overall performance of
     this operating segment. The managed basis presentation of the
     Card Services Group is derived by adjusting the GAAP financial
     information to add back securitized loan balances and the related
     interest, fee income and provision for credit losses. Such
     adjustments are eliminated as securitization adjustments when
     reporting GAAP results.
WM-7
                       Washington Mutual, Inc.
                    Selected Financial Information
                        (dollars in millions)
                             (unaudited)


                                        Quarter Ended
----------------------------------------------------------------------
(This table is
 continued from
 "WM-6.")               Dec. 31, Sept. 30, June 30, Mar. 31, Dec. 31,
                           2007      2007     2007     2007     2006
----------------------------------------------------------------------
COMMERCIAL GROUP
  Condensed income
   statement:
    Net interest
     income             $   200   $   200  $   208  $   211  $   201
    Provision for
     loan losses             19        12        2      (10)     (70)
    Noninterest
     income                 (10)      (34)      63       15       41
    Noninterest
     expense                 66        67       74       74       73
----------------------------------------------------------------------
    Income before
     income taxes           105        87      195      162      239
    Income taxes             11        29       73       61       91
----------------------------------------------------------------------
      Net income        $    94   $    58  $   122  $   101  $   148
======================================================================
  Performance and
   other data:
    Efficiency
     ratio                34.49%    40.26%   27.42%   32.85%   30.18%
    Average loans       $40,129   $38,333  $38,789  $38,641  $37,552
    Average assets       42,333    40,661   41,181   41,001   40,216
    Average
     deposits             9,762    13,816   15,294   12,028   12,189
    Loan volume           4,800     4,054    4,348    3,671    4,019
    Employees at
     end of period        1,406     1,426    1,409    1,356    1,416
HOME LOANS GROUP
  Condensed income
   statement:
    Net interest
     income             $   230   $   191  $   211  $   244  $   270
    Provision for
     loan losses            511       323      101       49       47
    Noninterest
     income                 329       183      389      161      125
    Inter-segment
     expense                  5         9       16       18       15
    Noninterest
     expense              2,319       553      547      521      533
----------------------------------------------------------------------
    Loss before
     income taxes        (2,276)     (511)     (64)    (183)    (200)
    Income taxes           (312)     (169)     (24)     (69)     (76)
----------------------------------------------------------------------
      Net loss          $(1,964)  $  (342) $   (40) $  (114) $  (124)
======================================================================
  Performance and
   other data:
    Efficiency
     ratio               418.90%   151.23%   93.54%  134.57%  140.22%
    Average loans       $52,278   $43,737  $43,312  $53,254  $51,048
    Average assets       66,130    61,068   60,314   71,367   71,503
    Average
     deposits             6,714     7,780    8,372    8,501   11,208
    Loan volume          19,089    26,434   35,938   33,780   37,532
    Employees at
     end of period       11,323    12,162   12,661   12,947   12,934
CORPORATE
 SUPPORT/TREASURY
 AND OTHER
  Condensed income
   statement:
    Net interest
     income
     (expense)          $   (18)  $   (39) $    (4) $   (22) $   (69)
    Provision for
     loan losses             85        (9)     (51)      27       45
    Noninterest
     income                (201)      (91)      60       94      152
    Noninterest
     expense                228        57       79      111      235
    Minority
     interest
     expense                 65        53       42       43       34
----------------------------------------------------------------------
    Loss from
     continuing
     operations
     before income
     taxes                 (597)     (231)     (14)    (109)    (231)
    Income taxes           (156)      (46)     (36)     (69)    (102)
----------------------------------------------------------------------
      Income (loss)
       from
       continuing
       operations          (441)     (185)      22      (40)    (129)
      Income from
       discontinued
       operations             -         -        -        -      406
----------------------------------------------------------------------
        Net income
         (loss)         $  (441)  $  (185) $    22  $   (40) $   277
======================================================================
  Performance and
   other data:
    Average loans       $ 1,482   $ 1,420  $ 1,367  $ 1,345  $ 1,310
    Average assets       48,215    47,570   41,817   40,891   46,233
    Average
     deposits            26,427    32,132   37,847   46,205   47,891
    Loan volume             171       113       72      107      144
    Employees at
     end of period        5,030     5,019    4,961    4,974    5,234



                              Year Ended
---------------------------------------------
(This table is
 continued from
 "WM-6.")                  Dec. 31,  Dec. 31,
                              2007      2006
---------------------------------------------
COMMERCIAL GROUP
  Condensed income
   statement:
    Net interest
     income               $    820  $    719
    Provision for
     loan losses                24       (82)
    Noninterest
     income                     35        99
    Noninterest
     expense                   282       259
---------------------------------------------
    Income before
     income taxes              549       641
    Income taxes               174       245
---------------------------------------------
      Net income          $    375  $    396
=============================================
  Performance and
   other data:
    Efficiency
     ratio                   32.93%    31.68%
    Average loans         $ 38,975  $ 33,230
    Average assets          41,296    35,565
    Average
     deposits               12,722    10,364
    Loan volume             16,873    12,854
    Employees at
     end of period           1,406     1,416
HOME LOANS GROUP
  Condensed income
   statement:
    Net interest
     income               $    878  $  1,165
    Provision for
     loan losses               985       189
    Noninterest
     income                  1,061     1,296
    Inter-segment
     expense                    48        58
    Noninterest
     expense                 3,939     2,295
---------------------------------------------
    Loss before
     income taxes           (3,033)      (81)
    Income taxes              (573)      (31)
---------------------------------------------
      Net loss            $ (2,460) $    (50)
=============================================
  Performance and
   other data:
    Efficiency
     ratio                  208.33%    95.48%
    Average loans         $ 48,131  $ 47,586
    Average assets          64,695    72,772
    Average
     deposits                7,836    11,535
    Loan volume            115,241   171,569
    Employees at
     end of period          11,323    12,934
CORPORATE
 SUPPORT/TREASURY
 AND OTHER
  Condensed income
   statement:
    Net interest
     income
     (expense)            $    (86) $   (304)
    Provision for
     loan losses                51      (162)
    Noninterest
     income                   (137)      303
    Noninterest
     expense                   475       684
    Minority
     interest
     expense                   203       105
---------------------------------------------
    Loss from
     continuing
     operations
     before income
     taxes                    (952)     (628)
    Income taxes              (308)     (296)
---------------------------------------------
      Income (loss)
       from
       continuing
       operations             (644)     (332)
      Income from
       discontinued
       operations                -       406
---------------------------------------------
        Net income
         (loss)           $   (644) $     74
=============================================
  Performance and
   other data:
    Average loans         $  1,403  $  1,126
    Average assets          44,651    40,722
    Average
     deposits               35,589    41,586
    Loan volume                462       308
    Employees at
     end of period           5,030     5,234


(This table is continued on "WM-8.")
WM-8
                       Washington Mutual, Inc.
                    Selected Financial Information
                        (dollars in millions)
                             (unaudited)


                                      Quarter Ended
----------------------------------------------------------------------
(This table is
 continued from
 "WM-7.")            Dec. 31, Sept. 30,  June 30,  Mar. 31,  Dec. 31,
                        2007      2007      2007      2007      2006
----------------------------------------------------------------------
RECONCILING
 ADJUSTMENTS
  Condensed income
   statement:
    Net interest
     income(1)      $    134  $    138  $    138  $    137  $    134
    Noninterest
     income
     (expense)(2)        (37)      (80)     (132)      (86)     (108)
----------------------------------------------------------------------
    Income before
     income taxes         97        58         6        51        26
    Income taxes
     (3)                  23       (75)      (22)       38       (26)
----------------------------------------------------------------------
        Net income  $     74  $    133  $     28  $     13  $     52
======================================================================
  Performance and
   other data:
    Average
     loans(4)       $ (1,286) $ (1,385) $ (1,301) $ (1,479) $ (1,573)
    Average
     assets(4)        (1,286)   (1,385)   (1,301)   (1,479)   (1,573)

TOTAL CONSOLIDATED
  Condensed income
   statement:
    Net interest
     income         $  2,047  $  2,014  $  2,034  $  2,081  $  1,998
    Provision for
     loan losses       1,534       967       372       234       344
    Noninterest
     income            1,365     1,379     1,758     1,541     1,592
    Noninterest
     expense           4,166     2,191     2,138     2,105     2,257
    Minority
     interest
     expense              65        53        42        43        34
----------------------------------------------------------------------
    Income (loss)
     from
     continuing
     operations
     before income
     taxes            (2,353)      182     1,240     1,240       955
    Income taxes        (486)       (4)      410       456       315
----------------------------------------------------------------------
      Income (loss)
       from
       continuing
       operations     (1,867)      186       830       784       640
      Income from
       discontinued
       operations          -         -         -         -       418
----------------------------------------------------------------------
        Net income
         (loss)     $ (1,867) $    186  $    830  $    784  $  1,058
======================================================================
  Performance and
   other data:
    Efficiency
     ratio            122.13%    64.55%    56.38%    58.13%    62.87%
    Average loans   $248,747  $240,692  $242,229  $258,064  $270,414
    Average assets   325,276   320,475   316,004   331,905   353,056
    Average
     deposits        185,636   198,649   206,765   210,764   214,801
    Loan volume       27,477    35,773    46,118    42,134    45,849
    Employees at
     end of period    49,403    49,748    49,989    49,693    49,824


                              Year Ended
------------------------- -------------------
(This table is
 continued from
 "WM-7.")                  Dec. 31,  Dec. 31,
                              2007      2006
------------------------- -------------------
RECONCILING
 ADJUSTMENTS
  Condensed income
   statement:
    Net interest
     income(1)            $    547  $    530
    Noninterest
     income
     (expense)(2)             (335)     (506)
---------------------------------------------
    Income before
     income taxes              212        24
    Income taxes
     (3)                       (36)     (102)
---------------------------------------------
        Net income        $    248  $    126
=============================================
  Performance and
   other data:
    Average
     loans(4)             $ (1,362) $ (1,587)
    Average
     assets(4)              (1,362)   (1,587)

TOTAL CONSOLIDATED
  Condensed income
   statement:
    Net interest
     income               $  8,177  $  8,121
    Provision for
     loan losses             3,107       816
    Noninterest
     income                  6,042     6,377
    Noninterest
     expense                10,600     8,807
    Minority
     interest
     expense                   203       105
---------------------------------------------
    Income (loss)
     from
     continuing
     operations
     before income
     taxes                     309     4,770
    Income taxes               376     1,656
---------------------------------------------
      Income (loss)
       from
       continuing
       operations              (67)    3,114
      Income from
       discontinued
       operations                -       444
---------------------------------------------
        Net income
         (loss)           $    (67) $  3,558
=============================================
  Performance and
   other data:
    Efficiency
     ratio                   74.55%    60.75%
    Average loans         $247,389  $266,885
    Average assets         323,389   348,758
    Average
     deposits              200,380   203,829
    Loan volume            151,502   205,085
    Employees at
     end of period          49,403    49,824

__________________________

(1) Represents the difference between mortgage loan premium
     amortization recorded by the Retail Banking Group and the amount
     recognized in the Company's Consolidated Statements of Income.
     For management reporting purposes, certain mortgage loans that
     are held in portfolio by the Retail Banking Group are treated as
     if they are purchased from the Home Loans Group. Since the cost
     basis of these loans includes an assumed profit factor paid to
     the Home Loans Group, the amortization of loan premiums recorded
     by the Retail Banking Group reflects this assumed profit factor
     and must therefore be eliminated as a reconciling adjustment.

(2) Represents the difference between gain from mortgage loans
     recorded by the Home Loans Group and gain from mortgage loans
     recognized in the Company's Consolidated Statements of Income.

(3) Represents the tax effect of reconciling adjustments.

(4) Represents the inter-segment offset for inter-segment loan
     premiums that the Retail Banking Group recognized upon transfer
     of portfolio loans from the Home Loans Group.
WM-9
                       Washington Mutual, Inc.
                    Selected Financial Information
                        (dollars in millions)
                             (unaudited)


                               Quarter Ended
--------------------------------------------------
                              Dec. 31, 2007
                         -------------------------
                                         Interest
                                         Income/
                         Balance   Rate  Expense
--------------------------------------------------
Average Balances and
 Weighted Average
 Interest Rates
Assets
Interest-earning
 assets(1):
  Federal funds sold
   and securities
   purchased under
   agreements to
   resell                $  1,673  4.65% $     20
  Trading assets            3,114 12.89       101
  Available-for-sale
   securities(2):
    Mortgage-backed
     securities            20,104  5.47       275
    Investment
     securities             8,029  5.22       105
  Loans held for sale       7,057  8.99       160
  Loans held in
   portfolio:
    Loans secured by
     real estate:
      Home loans(3)(4)    108,496  6.58     1,785
      Home equity
       loans and lines
       of credit(4)        60,135  7.15     1,083
      Subprime
       mortgage
       channel(5)          19,341  6.38       309
      Home
       construction(6)      2,136  6.99        37
      Multi-family         31,331  6.54       513
      Other real
       estate               8,969  6.89       155
---------------------------------        ---------
        Total loans
         secured by
         real estate      230,408  6.72     3,882
    Consumer:
      Credit card           9,134  9.76       225
      Other                   213 15.77         8
    Commercial              1,935  8.47        41
---------------------------------        ---------
        Total loans
         held in
         portfolio        241,690  6.86     4,156
  Other                     6,321  3.74        59
---------------------------------        ---------
        Total
         interest-
         earning
         assets           287,988  6.76     4,876
Noninterest-earning
 assets:
  Mortgage servicing
   rights                   6,472
  Goodwill                  8,907
  Other assets             21,909
---------------------------------
        Total assets     $325,276
=================================
Liabilities
Interest-bearing
 liabilities:
  Deposits:
    Interest-bearing
     checking deposits   $ 26,425  2.15       143
    Savings and money
     market deposits       54,622  3.14       432
    Time deposits          73,741  4.78       889
---------------------------------        ---------
        Total
         interest-
         bearing
         deposits         154,788  3.75     1,464
  Federal funds
   purchased and
   commercial paper         3,385  4.96        42
  Securities sold
   under agreements to
   repurchase               4,273  4.80        52
  Advances from
   Federal Home Loan
   Banks                   56,146  5.13       726
  Other                    39,268  5.52       545
---------------------------------        ---------
        Total
         interest-
         bearing
         liabilities      257,860  4.36     2,829
                                         ---------
Noninterest-bearing
 sources:
  Noninterest-bearing
   deposits                30,848
  Other liabilities         8,956
  Minority interests        3,665
  Stockholders' equity     23,947
---------------------------------
        Total
         liabilities
         and
         stockholders'
         equity          $325,276
=================================
  Net interest spread
   and net interest
   income                          2.40  $  2,047
                                         =========
  Impact of
   noninterest-bearing
   sources                         0.45
  Net interest margin              2.85


                              Quarter Ended
---------------------------------------------------
                               Sept. 30, 2007
                          -------------------------
                                          Interest
                                          Income/
                          Balance   Rate  Expense
---------------------------------------------------
Average Balances and
 Weighted Average
 Interest Rates
Assets
Interest-earning
 assets(1):
  Federal funds sold
   and securities
   purchased under
   agreements to
   resell                 $  4,349  5.43% $     60
  Trading assets             4,509  9.54       108
  Available-for-sale
   securities(2):
    Mortgage-backed
     securities             20,815  5.60       291
    Investment
     securities              7,721  5.21       101
  Loans held for sale       13,344  7.41       248
  Loans held in
   portfolio:
    Loans secured by
     real estate:
      Home loans(3)(4)      97,398  6.48     1,579
      Home equity
       loans and lines
       of credit(4)         57,469  7.56     1,094
      Subprime
       mortgage
       channel(5)           20,405  6.63       338
      Home
       construction(6)       2,056  6.90        35
      Multi-family          30,058  6.63       498
      Other real
       estate                7,418  6.99       131
----------------------    --------        ---------
        Total loans
         secured by
         real estate       214,804  6.83     3,675
    Consumer:
      Credit card           10,332 10.28       268
      Other                    233 14.83         8
    Commercial               1,979  8.25        41
----------------------    --------        ---------
        Total loans
         held in
         portfolio         227,348  7.01     3,992
  Other                      5,177  4.33        56
----------------------    --------        ---------
        Total
         interest-
         earning
         assets            283,263  6.84     4,856
Noninterest-earning
 assets:
  Mortgage servicing
   rights                    6,901
  Goodwill                   9,056
  Other assets              21,255
----------------------    --------
        Total assets      $320,475
======================    ========
Liabilities
Interest-bearing
 liabilities:
  Deposits:
    Interest-bearing
     checking deposits    $ 28,492  2.36       169
    Savings and money
     market deposits        57,377  3.32       480
    Time deposits           80,719  4.92     1,001
----------------------    --------        ---------
        Total
         interest-
         bearing
         deposits          166,588  3.93     1,650
  Federal funds
   purchased and
   commercial paper          2,991  5.40        41
  Securities sold
   under agreements to
   repurchase                8,617  5.34       116
  Advances from
   Federal Home Loan
   Banks                    34,128  5.39       464
  Other                     40,567  5.60       571
----------------------    --------        ---------
        Total
         interest-
         bearing
         liabilities       252,891  4.46     2,842
                                          ---------
Noninterest-bearing
 sources:
  Noninterest-bearing
   deposits                 32,061
  Other liabilities          8,584
  Minority interests         2,945
  Stockholders' equity      23,994
----------------------    --------
        Total
         liabilities
         and
         stockholders'
         equity           $320,475
======================    ========
  Net interest spread
   and net interest
   income                           2.38  $  2,014
                                          =========
  Impact of
   noninterest-bearing
   sources                          0.48
  Net interest margin               2.86


                             Quarter Ended
--------------------------------------------------
                               Dec. 31, 2006
                          ------------------------
                                          Interest
                                          Income/
                          Balance   Rate  Expense
--------------------------------------------------
Average Balances and
 Weighted Average
 Interest Rates
Assets
Interest-earning
 assets(1):
  Federal funds sold
   and securities
   purchased under
   agreements to
   resell                 $  5,597  5.33% $     76
  Trading assets             4,855  8.39       102
  Available-for-sale
   securities(2):
    Mortgage-backed
     securities             22,176  5.60       311
    Investment
     securities              6,437  5.04        81
  Loans held for sale       31,149  6.59       515
  Loans held in
   portfolio:
    Loans secured by
     real estate:
      Home loans(3)(4)     114,645  6.04     1,729
      Home equity
       loans and lines
       of credit(4)         52,850  7.54     1,004
      Subprime
       mortgage
       channel(5)           20,982  6.81       357
      Home
       construction(6)       2,060  6.62        34
      Multi-family          30,348  6.52       494
      Other real
       estate                6,732  6.88       118
----------------------    --------        --------
        Total loans
         secured by
         real estate       227,617  6.55     3,736
    Consumer:
      Credit card            9,597 11.28       273
      Other                    280 12.54         9
    Commercial               1,771  7.72        35
----------------------    --------        --------
        Total loans
         held in
         portfolio         239,265  6.76     4,053
  Other                      5,305  5.35        72
----------------------    --------        --------
        Total
         interest-
         earning
         assets            314,784  6.60     5,210
Noninterest-earning
 assets:
  Mortgage servicing
   rights                    6,230
  Goodwill                   9,011
  Other assets              23,031
----------------------    --------
        Total assets      $353,056
======================    ========
Liabilities
Interest-bearing
 liabilities:
  Deposits:
    Interest-bearing
     checking deposits    $ 33,098  2.78       232
    Savings and money
     market deposits        53,314  3.34       449
    Time deposits           93,415  4.90     1,162
----------------------    --------        --------
        Total
         interest-
         bearing
         deposits          179,827  4.05     1,843
  Federal funds
   purchased and
   commercial paper          6,781  5.40        93
  Securities sold
   under agreements to
   repurchase               12,177  5.43       169
  Advances from
   Federal Home Loan
   Banks                    46,005  5.31       625
  Other                     34,420  5.54       482
----------------------    --------        --------
        Total
         interest-
         bearing
         liabilities       279,210  4.53     3,212
                                          --------
Noninterest-bearing
 sources:
  Noninterest-bearing
   deposits                 34,974
  Other liabilities         10,111
  Minority interests         2,061
  Stockholders' equity      26,700
----------------------    --------
        Total
         liabilities
         and
         stockholders'
         equity           $353,056
======================    ========
  Net interest spread
   and net interest
   income                           2.07  $  1,998
                                          ========
  Impact of
   noninterest-bearing
   sources                          0.51
  Net interest margin               2.58

_______________________________

 (1) Nonaccrual assets and related income, if any, are included in
      their respective categories.

 (2) The average balance and yield are based on average amortized cost
      balances.

 (3) Capitalized interest recognized in earnings that resulted from
      negative amortization within the Option ARM portfolio totaled
      $364 million, $345 million and $333 million for the three months
      ended December 31, 2007, September 30, 2007 and December 31,
      2006.

 (4) Excludes home loans and home equity loans and lines of credit in
      the subprime mortgage channel.

 (5) Represents mortgage loans purchased from recognized subprime
      lenders and mortgage loans originated under the Long Beach
      Mortgage name and held in the investment portfolio.

 (6) Represents loans to builders for the purpose of financing the
      acquisition, development and construction of single-family
      residences for sale and construction loans made directly to the
      intended occupant of a single-family residence.
WM-10
                       Washington Mutual, Inc.
                    Selected Financial Information
                        (dollars in millions)
                             (unaudited)


                                                    Year Ended
----------------------------------------------------------------------
                                                  Dec. 31, 2007
                                             -------------------------
                                                             Interest
                                                             Income/
                                             Balance   Rate  Expense
----------------------------------------------------------------------
Average Balances and Weighted Average
 Interest Rates
Assets
Interest-earning assets(1):
  Federal funds sold and securities
   purchased under agreements to resell      $  3,475  5.31%  $   184
  Trading assets                                4,546  9.45       430
  Available-for-sale securities(2):
    Mortgage-backed securities                 19,647  5.49     1,078
    Investment securities                       7,334  5.13       377
  Loans held for sale                          20,421  6.81     1,391
  Loans held in portfolio:
    Loans secured by real estate:
      Home loans(3)(4)                         98,547  6.49     6,396
      Home equity loans and lines of
       credit(4)                               56,285  7.46     4,197
      Subprime mortgage channel(5)             20,125  6.62     1,333
      Home construction(6)                      2,074  6.79       141
      Multi-family                             30,162  6.59     1,988
      Other real estate                         7,504  6.98       524
-----------------------------------------------------        ---------
        Total loans secured by real estate    214,697  6.79    14,579
    Consumer:
      Credit card                              10,113 10.55     1,067
      Other                                       242 13.90        34
    Commercial                                  1,916  8.10       155
-----------------------------------------------------        ---------
        Total loans held in portfolio         226,968  6.98    15,835
  Other                                         4,275  4.53       194
-----------------------------------------------------        ---------
        Total interest-earning assets         286,666  6.80    19,489
Noninterest-earning assets:
  Mortgage servicing rights                     6,616
  Goodwill                                      9,018
  Other assets                                 21,089
-----------------------------------------------------
        Total assets                         $323,389
=====================================================
Liabilities
Interest-bearing liabilities:
  Deposits:
    Interest-bearing checking deposits       $ 29,261  2.42       709
    Savings and money market deposits          56,459  3.27     1,846
    Time deposits                              82,551  4.91     4,055
-----------------------------------------------------        ---------
        Total interest-bearing deposits       168,271  3.93     6,610
  Federal funds purchased and commercial
   paper                                        3,096  5.30       164
  Securities sold under agreements to
   repurchase                                   8,330  5.32       443
  Advances from Federal Home Loan Banks        37,144  5.28     1,963
  Other                                        38,157  5.59     2,132
-----------------------------------------------------        ---------
        Total interest-bearing liabilities    254,998  4.44    11,312
                                                             ---------
Noninterest-bearing sources:
  Noninterest-bearing deposits                 32,109
  Other liabilities                             9,155
  Minority interests                            2,933
  Stockholders' equity                         24,194
-----------------------------------------------------
        Total liabilities and stockholders'
         equity                              $323,389
=====================================================
  Net interest spread and net interest
   income                                              2.36   $ 8,177
                                                             =========
  Impact of noninterest-bearing sources                0.49
  Net interest margin                                  2.85


                                                   Year Ended
---------------------------------------------------------------------
                                                  Dec. 31, 2006
                                             ------------------------
                                                             Interest
                                                             Income/
                                             Balance   Rate  Expense
---------------------------------------------------------------------
Average Balances and Weighted Average
 Interest Rates
Assets
Interest-earning assets(1):
  Federal funds sold and securities
   purchased under agreements to resell      $  4,718  5.20%  $   245
  Trading assets                                7,829  7.74       606
  Available-for-sale securities(2):
    Mortgage-backed securities                 21,534  5.41     1,165
    Investment securities                       5,992  4.92       295
  Loans held for sale                          27,791  6.50     1,807
  Loans held in portfolio:
    Loans secured by real estate:
      Home loans(3)(4)                        120,320  5.83     7,011
      Home equity loans and lines of
       credit(4)                               52,265  7.33     3,833
      Subprime mortgage channel(5)             20,202  6.31     1,275
      Home construction(6)                      2,061  6.46       133
      Multi-family                             27,386  6.28     1,721
      Other real estate                         5,797  6.93       402
-----------------------------------------------------        --------
        Total loans secured by real estate    228,031  6.30    14,375
    Consumer:
      Credit card                               8,733 11.19       977
      Other                                       444 11.12        50
    Commercial                                  1,886  6.94       131
-----------------------------------------------------        --------
        Total loans held in portfolio         239,094  6.50    15,533
  Other                                         5,220  4.90       256
-----------------------------------------------------        --------
        Total interest-earning assets         312,178  6.38    19,907
Noninterest-earning assets:
  Mortgage servicing rights                     7,667
  Goodwill                                      8,489
  Other assets                                 20,424
-----------------------------------------------------
        Total assets                         $348,758
=====================================================
Liabilities
Interest-bearing liabilities:
  Deposits:
    Interest-bearing checking deposits       $ 36,477  2.63       960
    Savings and money market deposits          48,866  2.96     1,446
    Time deposits                              84,106  4.59     3,857
-----------------------------------------------------        --------
        Total interest-bearing deposits       169,449  3.70     6,263
  Federal funds purchased and commercial
   paper                                        7,347  5.06       371
  Securities sold under agreements to
   repurchase                                  15,257  5.12       781
  Advances from Federal Home Loan Banks        56,619  4.99     2,828
  Other                                        28,796  5.36     1,543
-----------------------------------------------------        --------
        Total interest-bearing liabilities    277,468  4.25    11,786
                                                             --------
Noninterest-bearing sources:
  Noninterest-bearing deposits                 34,380
  Other liabilities                             8,865
  Minority interests                            1,639
  Stockholders' equity                         26,406
-----------------------------------------------------
        Total liabilities and stockholders'
         equity                              $348,758
=====================================================
  Net interest spread and net interest
   income                                              2.13   $ 8,121
                                                             ========
  Impact of noninterest-bearing sources                0.47
  Net interest margin                                  2.60

_______________________________

(1) Nonaccrual assets and related income, if any, are included in
     their respective categories.

(2) The average balance and yield are based on average amortized cost
     balances.

(3) Capitalized interest recognized in earnings that resulted from
     negative amortization within the Option ARM portfolio totaled
     $1.41 billion and $1.07 billion for the years ended December 31,
     2007 and December 31, 2006.

(4) Excludes home loans and home equity loans and lines of credit in
     the subprime mortgage channel.

(5) Represents mortgage loans purchased from recognized subprime
     lenders and mortgage loans originated under the Long Beach
     Mortgage name and held in the investment portfolio.

(6) Represents loans to builders for the purpose of financing the
     acquisition, development and construction of single-family
     residences for sale and construction loans made directly to the
     intended occupant of a single-family residence.
WM-11
                       Washington Mutual, Inc.
                    Selected Financial Information
                        (dollars in millions)
                             (unaudited)




                      Change
                        from
                    Sept. 30,
                     2007 to
                     Dec. 31,     Dec. 31,  Sept. 30,
                        2007         2007       2007
-----------------------------------------------------
Deposits
  Retail deposits:
    Checking
     deposits:
      Noninterest
       bearing      $   (245)    $ 23,476  $ 23,721
      Interest
       bearing        (1,564)      25,713    27,277
-----------------------------------------------------
        Total
         checking
         deposits     (1,809)      49,189    50,998
    Savings and
     money market
     deposits          1,627       44,987    43,360
    Time
     deposits(1)      (1,330)      49,410    50,740
-----------------------------------------------------
        Total
         retail
         deposits     (1,512)     143,586   145,098
    Commercial
     business and
     other deposits   (5,269)      11,267    16,536
    Brokered
     deposits:
      Consumer           605       18,089    17,484
      Institutional   (5,592)       2,515     8,107
    Custodial and
     escrow
     deposits(2)        (586)       6,469     7,055
-----------------------------------------------------
        Total
         deposits   $(12,354)    $181,926  $194,280
=====================================================








                     June 30,  Mar. 31,  Dec. 31,
                        2007      2007      2006
-------------------------------------------------
Deposits
  Retail deposits:
    Checking
     deposits:
      Noninterest
       bearing      $ 24,142  $ 24,400  $ 22,838
      Interest
       bearing        29,592    31,523    32,723
-------------------------------------------------
        Total
         checking
         deposits     53,734    55,923    55,561
    Savings and
     money market
     deposits         43,617    44,058    41,943
    Time
     deposits(1)      48,140    47,262    46,821
-------------------------------------------------
        Total
         retail
         deposits    145,491   147,243   144,325
    Commercial
     business and
     other deposits   19,186    17,741    15,175
    Brokered
     deposits:
      Consumer        17,153    18,995    22,299
      Institutional   11,025    17,256    22,339
    Custodial and
     escrow
     deposits(2)       8,525     8,974     9,818
-------------------------------------------------
        Total
         deposits   $201,380  $210,209  $213,956
=================================================


(1) Weighted average remaining maturity of time deposits was 7 months
     at December 31, 2007 and at September 30, 2007, 8 months at June
     30, 2007 and 9 months at March 31, 2007 and December 31, 2006.

(2) Substantially all custodial and escrow deposits reside in
     noninterest-bearing checking accounts.


                           Dec. 31,     Sept. 30,    June 30,
                              2007          2007        2007
-------------------------------------------------------------
Retail Deposit
 Accounts (number of
 accounts)
    Noninterest-
     bearing
     checking           10,960,270   10,824,548   10,449,887
    Interest-bearing
     checking            1,273,673    1,334,902    1,399,203
    Savings and
     money market        7,118,349    7,087,311    6,936,870
-------------------------------------------------------------
        Total
         transaction
         accounts,
         end of
         period(1)      19,352,292   19,246,761   18,785,960
=============================================================

    Net change in
     noninterest-
     bearing
     checking
     accounts              135,722      374,661      466,574
    Net change in
     checking
     accounts               74,493      310,360      406,243


                          Mar. 31,     Dec. 31,
                             2007         2006
-----------------------------------------------
Retail Deposit
 Accounts (number of
 accounts)
    Noninterest-
     bearing
     checking           9,983,313    9,611,706
    Interest-bearing
     checking           1,459,534    1,503,365
    Savings and
     money market       6,708,784    6,525,772
-----------------------------------------------
        Total
         transaction
         accounts,
         end of
         period(1)     18,151,631   17,640,843
===============================================

    Net change in
     noninterest-
     bearing
     checking
     accounts             371,607      208,634
    Net change in
     checking
     accounts             327,776      179,784

_______________________________
(1) Transaction accounts include retail checking, small business
     checking, retail savings and small business savings.

                      Dec. 31, Sept. 30, June 30, Mar. 31, Dec. 31,
                         2007      2007     2007     2007     2006
-------------------------------------------------------------------
Retail Banking
 Stores
Stores, beginning
 of period              2,212    2,235     2,228    2,225    2,225
    Stores opened
     during the
     quarter               50       10        11        6       81 (1)
    Stores closed
     during the
     quarter               (5)     (33)       (4)      (3)     (81)
-------------------------------------------------------------------
Stores, end of
 period                 2,257    2,212     2,235    2,228    2,225
===================================================================

(1) Includes 26 retail banking stores acquired through the merger with
     Commercial Capital Bancorp.
WM-12
                       Washington Mutual, Inc.
                   Selected Financial Information
                        (dollars in millions)
                             (unaudited)

                                        Quarter Ended
----------------------------------------------------------------------
                         Dec. 31, Sept. 30, June 30, Mar. 31, Dec. 31,
                            2007      2007     2007     2007     2006
----------------------------------------------------------------------
Loan Volume
  Home loans:
    Short-term
     adjustable-rate
     loans(1):
      Option ARMs        $ 2,372   $ 5,865  $ 7,888  $ 7,777  $ 9,487
      Other ARMs              10       111       22       36       13
----------------------------------------------------------------------
        Total short-term
         adjustable-rate
         loans             2,382     5,976    7,910    7,813    9,500
    Medium-term
     adjustable-rate
     loans(2)              7,545    10,177   14,953   13,567   17,323
    Fixed-rate loans       7,382     6,176    8,172    8,824    7,351
----------------------------------------------------------------------
        Total home loan
         volume           17,309    22,329   31,035   30,204   34,174
  Home equity loans and
   lines of credit         4,619     8,544    9,988    7,600    6,944
  Home construction(3)       378       483      426      298      298
  Multi-family             3,412     2,856    3,067    2,663    2,977
  Other real estate        1,487     1,285    1,246    1,080    1,182
----------------------------------------------------------------------
        Total loans
         secured by real
         estate(4)        27,205    35,497   45,762   41,845   45,575
  Commercial                 272       276      356      289      274
----------------------------------------------------------------------
        Total loan
         volume          $27,477   $35,773  $46,118  $42,134  $45,849
======================================================================
Loan Volume by Channel
  Retail                 $17,341   $21,223  $24,707  $21,171  $22,417
  Wholesale                9,536    13,387   17,020   14,746   16,834
  Purchased                  600     1,163    4,391    6,217    6,398
  Correspondent                -         -        -        -      200
----------------------------------------------------------------------
        Total loan
         volume by
         channel         $27,477   $35,773  $46,118  $42,134  $45,849
======================================================================
Refinancing Activity(5)
  Home loan refinancing  $12,297   $14,722  $22,637  $22,552  $25,060
  Home equity loans and
   lines of credit            46       143      157      550      599
  Home construction
   loans                      30        30       20       12        2
  Multi-family and other
   real estate             1,436     1,225    1,378    1,131    1,254
----------------------------------------------------------------------
        Total
         refinancing     $13,809   $16,120  $24,192  $24,245  $26,915
======================================================================

(1) Short-term adjustable-rate loans reprice within one year.

(2) Medium-term adjustable-rate loans reprice after one year.

(3) Represents loans to builders for the purpose of financing the
     acquisition, development and construction of single-family
     residences for sale and construction loans made directly to the
     intended occupant of a single-family residence.

(4) Includes mortgage loans purchased from recognized subprime lenders
     and mortgage loans originated under the Long Beach Mortgage name
     of $22 million, $483 million, $2.45 billion, $3.48 billion and
     $6.07 billion for the three months ended December 31, 2007,
     September 30, 2007, June 30, 2007, March 31, 2007 and December
     31, 2006.

(5) Includes loan refinancing entered into by both new and pre-
     existing loan customers.
WM-13
                       Washington Mutual, Inc.
                    Selected Financial Information
                        (dollars in millions)
                             (unaudited)

                                                       Year Ended
----------------------------------------------------------------------
                                                    Dec. 31,  Dec. 31,
                                                       2007      2006
----------------------------------------------------------------------
Loan Volume
  Home loans:
    Short-term adjustable-rate loans(1):
      Option ARMs                                  $ 23,902  $ 42,594
      Other ARMs                                        180     3,384
----------------------------------------------------------------------
        Total short-term adjustable-rate loans       24,082    45,978
    Medium-term adjustable-rate loans(2)             46,242    64,936
    Fixed-rate loans                                 30,554    47,469
----------------------------------------------------------------------
        Total home loan volume                      100,878   158,383
  Home equity loans and lines of credit              30,752    31,037
  Home construction(3)                                1,584     1,481
  Multi-family                                       11,997     9,428
  Other real estate                                   5,097     3,668
----------------------------------------------------------------------
        Total loans secured by real estate(4)       150,308   203,997
  Commercial                                          1,194     1,088
----------------------------------------------------------------------
        Total loan volume                          $151,502  $205,085
======================================================================
Loan Volume by Channel
  Retail                                           $ 84,442  $ 89,688
  Wholesale                                          54,690    64,501
  Purchased                                          12,370    37,310
  Correspondent                                           -    13,586
----------------------------------------------------------------------
        Total loan volume by channel               $151,502  $205,085
======================================================================
Refinancing Activity(5)
  Home loan refinancing                            $ 72,209  $102,589
  Home equity loans and lines of credit                 897     1,665
  Home construction loans                                91        39
  Multi-family and other real estate                  5,169     3,590
----------------------------------------------------------------------
        Total refinancing                          $ 78,366  $107,883
======================================================================

(1)  Short-term adjustable-rate loans reprice within one year.

(2)  Medium-term adjustable-rate loans reprice after one year.

(3)  Represents loans to builders for the purpose of financing the
      acquisition, development and construction of single-family
      residences for sale and construction loans made directly to the
      intended occupant of a single-family residence.

(4)  Includes mortgage loans purchased from recognized subprime
      lenders and mortgage loans originated under the Long Beach
      Mortgage name of $6.44 billion and $30.76 billion for the years
      ended December 31, 2007 and December 31, 2006.

(5)  Includes loan refinancing entered into by both new and pre-
      existing loan customers.
WM-14
                       Washington Mutual, Inc.
                    Selected Financial Information
                        (dollars in millions)
                             (unaudited)

                                 Change
                                   from
                               Sept. 30,
                                2007 to
                                Dec. 31, Dec. 31,  Sept. 30,  June 30,
                                   2007     2007       2007      2007
------------------------------------------------------------ ---------
Loans Held in Portfolio
  Loans secured by real
   estate:
    Home:
     Short-term adjustable-
      rate loans(1):
       Option ARMs(2)           $ (877) $ 56,969  $ 57,846   $ 53,455
       Other ARMs                  753    16,231    15,478     13,538
------------------------------------------------------------ ---------
         Total short-term
          adjustable-rate
          loans                   (124)   73,200    73,324     66,993
      Medium-term adjustable-
       rate loans(3)             3,266    41,274    38,008     29,647
      Fixed-rate loans             192    12,005    11,813      9,505
------------------------------------------------------------ ---------
         Total home loans        3,334   126,479   123,145    106,145
    Home equity loans and
     lines of credit             1,657    63,488    61,831     58,631
    Home construction(4)           116     2,226     2,110      2,058
    Multi-family                   923    31,754    30,831     29,290
    Other real estate            1,189     9,524     8,335      6,879
------------------------------------------------------------ ---------
         Total loans secured
          by real estate(5)      7,219   233,471   226,252    203,003
  Consumer:
   Credit card                      40     8,831     8,791      9,913
   Other                           (19)      205       224        243
  Commercial                        14     1,879     1,865      1,835
------------------------------------------------------------ ---------
         Total loans held in
          portfolio(6)           7,254   244,386   237,132    214,994
 Less: allowance for loan
  losses                          (682)   (2,571)   (1,889)    (1,560)
------------------------------------------------------------ ---------
         Total loans held in
          portfolio, net        $6,572  $241,815  $235,243   $213,434
============================================================ =========

                                  Mar. 31, Dec. 31,
                                     2007     2006
---------------------------------------------------
Loans Held in Portfolio
  Loans secured by real estate:
    Home:
     Short-term adjustable-rate
      loans(1):
       Option ARMs(2)           $ 58,130  $ 63,557
       Other ARMs                 13,501    15,091
---------------------------------------------------
         Total short-term
          adjustable-rate loans   71,631    78,648
      Medium-term adjustable-
       rate loans(3)              29,924    29,774
      Fixed-rate loans             9,506     9,782
---------------------------------------------------
         Total home loans        111,061   118,204
    Home equity loans and lines
     of credit                    56,123    54,924
    Home construction(4)           2,071     2,082
    Multi-family                  29,515    30,161
    Other real estate              6,728     6,745
---------------------------------------------------
         Total loans secured by
          real estate(5)         205,498   212,116
  Consumer:
   Credit card                     9,490    10,861
   Other                             261       276
  Commercial                       1,772     1,707
---------------------------------------------------
         Total loans held in
          portfolio(6)           217,021   224,960
 Less: allowance for loan
  losses                          (1,540)   (1,630)
---------------------------------------------------
         Total loans held in
          portfolio, net        $215,481  $223,330
===================================================

(1) Short-term adjustable-rate loans reprice within one year.

(2) The total amount by which the unpaid principal balance of Option
     ARM loans exceeded their original principal amount was $1.73
     billion, $1.50 billion, $1.30 billion, $1.12 billion and $888
     million at December 31, 2007, September 30, 2007, June 30, 2007,
     March 31, 2007 and December 31, 2006.

(3) Medium-term adjustable-rate loans reprice after one year.

(4) Represents loans to builders for the purpose of financing the
     acquisition, development and construction of single-family
     residences for sale and construction loans made directly to the
     intended occupant of a single-family residence.

(5) Includes subprime mortgage channel loans, comprising mortgage
     loans purchased from recognized subprime lenders and mortgage
     loans originated under the Long Beach Mortgage name and held in
     the investment portfolio as follows:
   -------------------------------------------------------------------
    Subprime Mortgage
     Channel              Dec. 31, Sept. 30, June 30, Mar. 31,Dec. 31,
                             2007      2007     2007     2007    2006
   -------------------------------------------------------------------
    Home loans            $16,092   $17,285  $17,602  $17,610 $18,725
    Home equity loans
     and lines of
     credit                 2,525     2,711    2,855    2,749   2,042
   -------------------------------------------------------------------
            Total         $18,617   $19,996  $20,457  $20,359 $20,767
   ===================================================================

(6) Includes net unamortized deferred loan costs of $1.45 billion,
     $1.44 billion, $1.58 billion, $1.71 billion and $1.88 billion at
     December 31, 2007, September 30, 2007, June 30, 2007, March 31,
     2007 and December 31, 2006.
WM-15
                       Washington Mutual, Inc.
                    Selected Financial Information
                        (dollars in millions)
                             (unaudited)

                    Change from
                       Sept. 30,         Weighted            Weighted
                        2007 to           Average             Average
                        Dec. 31, Dec. 31, Coupon   Sept. 30,  Coupon
                           2007     2007   Rate        2007    Rate
----------------------------------------------------------------------
Selected Loans
 Secured by Real
 Estate
  Home loans held in
   portfolio:
    Short-term
     adjustable-rate
     loans(1):
      Option ARMs   $      (877) $ 56,969    7.69% $ 57,846      7.61%
      Other ARMs            753    16,231    6.99    15,478      7.19
-----------------------------------------         ----------
        Total short-
         term
         adjustable-
         rate loans        (124)   73,200    7.54    73,324      7.52
    Medium-term
     adjustable-rate
     loans(2)             3,266    41,274    6.45    38,008      6.33
    Fixed-rate loans        192    12,005    6.75    11,813      6.74
-----------------------------------------         ----------
        Total home
         loans held
         in
         portfolio        3,334   126,479    7.11   123,145      7.09
  Home equity loans
   and lines of
   credit:
    Adjustable-rate       2,124    53,099    7.52    50,975      7.94
    Fixed-rate             (467)   10,389    7.72    10,856      7.75
-----------------------------------------         ----------
        Total home
         equity
         loans and
         lines of
         credit           1,657    63,488    7.55    61,831      7.91
  Multi-family loans
   held in
   portfolio:
    Short-term
     adjustable-rate
     loans(1):
      Option ARMs          (787)    6,294    7.12     7,081      7.25
      Other ARMs           (269)    8,110    6.40     8,379      6.53
-----------------------------------------         ----------
        Total
         short-term
         adjustable-
         rate loans      (1,056)   14,404    6.71    15,460      6.86
    Medium-term
     adjustable-rate
     loans(2)             1,943    15,451    6.14    13,508      6.12
    Fixed-rate loans         36     1,899    6.28     1,863      6.31
-----------------------------------------         ----------
        Total multi-
         family
         loans held
         in
         portfolio          923    31,754    6.41    30,831      6.50
-----------------------------------------         ----------
        Total
         selected
         loans held
         in
         portfolio
         secured by
         real
         estate(3)        5,914   221,721    7.13   215,807      7.24
  Loans held for
   sale(4)               (1,854)    4,373    6.12     6,227      6.36
-----------------------------------------         ----------
        Total
         selected
         loans
         secured by
         real estate$     4,060  $226,094    7.12  $222,034      7.21
=========================================         ==========

                               Weighted
                                Average
                      Dec. 31,  Coupon
                         2006    Rate
---------------------------------------
Selected Loans
 Secured by Real
 Estate
  Home loans held in
   portfolio:
    Short-term
     adjustable-rate
     loans(1):
      Option ARMs    $ 63,557      7.44%
      Other ARMs       15,091      7.17
--------------------  --------
        Total short-
         term
         adjustable-
         rate loans    78,648      7.39
    Medium-term
     adjustable-rate
     loans(2)          29,774      5.77
    Fixed-rate loans    9,782      6.65
--------------------  --------
        Total home
         loans held
         in
         portfolio    118,204      6.92
  Home equity loans
   and lines of
   credit:
    Adjustable-rate    44,685      8.21
    Fixed-rate         10,239      7.29
--------------------  --------
        Total home
         equity
         loans and
         lines of
         credit        54,924      8.04
  Multi-family loans
   held in
   portfolio:
    Short-term
     adjustable-rate
     loans(1):
      Option ARMs       9,164      7.18
      Other ARMs        7,473      7.12
--------------------  --------
        Total short-
         term
         adjustable-
         rate loans    16,637      7.15
    Medium-term
     adjustable-rate
     loans(2)          11,757      5.68
    Fixed-rate loans    1,767      6.44
--------------------  --------
        Total multi-
         family
         loans held
         in
         portfolio     30,161      6.54
--------------------  --------
        Total
         selected
         loans held
         in
         portfolio
         secured by
         real
         estate(3)    203,289      7.17
  Loans held for
   sale(4)             44,724      6.32
--------------------  --------
        Total
         selected
         loans
         secured by
         real estate $248,013      7.01
====================  ========

(1) Short-term adjustable-rate loans reprice within one year.

(2) Medium-term adjustable-rate loans reprice after one year.

(3) At December 31, 2007, September 30, 2007 and December 31, 2006,
     adjustable-rate loans with lifetime caps were $182.12 billion,
     $175.21 billion and $169.60 billion with a lifetime weighted
     average cap rate of 12.49%, 12.44% and 12.29%.

(4) Excludes credit card and student loans.


                                      Sept. 30, 2007     Dec. 31, 2006
                                    to Dec. 31, 2007  to Dec. 31, 2007
----------------------------------------------------------------------
Rollforward of Loans Held for Sale
  Balance, beginning of period            $  7,586     $       44,970
    Mortgage loans originated,
     purchased and transferred from
     held in portfolio                       9,424             83,372
    Mortgage loans transferred to
     held in portfolio                        (577)           (20,255)
    Mortgage loans sold and
     other(1)                              (10,700)          (103,468)
    Net change in consumer loans
     held for sale                            (330)               784
---------------------------------------------------------------------
  Balance, end of period                  $  5,403     $        5,403
=====================================================================

Rollforward of Home Loans Held in
 Portfolio
  Balance, beginning of period            $123,145     $      118,204
    Loans originated, purchased and
     transferred from held for sale          8,644             44,656
    Loan payments, transferred to
     held for sale and other                (5,310)           (36,381)
----------------------------------------------------------------------
  Balance, end of period                  $126,479     $      126,479
=====================================================================

(1) The unpaid principal balance ("UPB") of home loans sold was $8.35
     billion and $92.93 billion for the three and twelve months ended
     December 31, 2007.
WM-16
                       Washington Mutual, Inc.
                    Selected Financial Information
                        (dollars in millions)
                             (unaudited)

                                         Quarter Ended
----------------------------------------------------------------------
Detail of Revenue from
 Sales and Servicing of
 Home Mortgage Loans     Dec. 31, Sept. 30, June 30, Mar. 31, Dec. 31,
                            2007      2007     2007     2007     2006
----------------------------------------------------------------------
Gain (loss) from home
 mortgage loans and
 originated mortgage-
 backed securities, net
 of hedging and risk
 management
 instruments(1):
  Gain (loss) from home
   mortgage loans and
   originated mortgage-
   backed securities       $   7     $(169)   $  66  $   149  $    64
  Revaluation gain (loss)
   from derivatives
   economically hedging
   loans held for sale       (12)      (53)     126      (54)      91
----------------------------------------------------------------------
    Gain (loss) from home
     mortgage loans and
     originated mortgage-
     backed securities,
     net of hedging and
     risk management
     instruments              (5)     (222)     192       95      155
----------------------------------------------------------------------
Home mortgage loan
 servicing revenue:
  Home mortgage loan
   servicing revenue(2)      490       516      526      514      497
  Change in MSR fair
   value due to payments
   on loans and other       (255)     (351)    (401)    (356)    (375)
----------------------------------------------------------------------
    Net mortgage loan
     servicing revenue       235       165      125      158      122
  Change in MSR fair
   value due to valuation
   inputs or assumptions    (390)     (201)     530      (96)     (80)
  Revaluation gain (loss)
   from derivatives
   economically hedging
   MSR                       518       419     (547)     (32)     (33)
----------------------------------------------------------------------
    Home mortgage loan
     servicing revenue,
     net of MSR valuation
     changes and
     derivative risk
     management
     instruments             363       383      108       30        9
----------------------------------------------------------------------
      Total revenue from
       sales and
       servicing of home
       mortgage loans      $ 358     $ 161    $ 300  $   125  $   164
======================================================================

                                                        Year Ended
----------------------------------------------------------------------
Detail of Revenue from
 Sales and Servicing of
 Home Mortgage Loans                                 Dec. 31, Dec. 31,
                                                        2007     2006
----------------------------------------------------------------------
Gain from home mortgage
 loans and originated
 mortgage-backed
 securities, net of
 hedging and risk
 management
 instruments(1):
  Gain from home mortgage
   loans and originated
   mortgage-backed
   securities                                        $    52  $   626
  Revaluation gain from
   derivatives
   economically hedging
   loans held for sale                                     7      109
----------------------------------------------------------------------
    Gain from home
     mortgage loans and
     originated mortgage-
     backed securities,
     net of hedging and
     risk management
     instruments                                          59      735
----------------------------------------------------------------------
Home mortgage loan
 servicing revenue:
  Home mortgage loan
   servicing revenue(2)                                2,047    2,181
  Change in MSR fair
   value due to payments
   on loans and other                                 (1,363)  (1,654)
----------------------------------------------------------------------
    Net mortgage loan
     servicing revenue                                   684      527
  Change in MSR fair
   value due to valuation
   inputs or assumptions                                (157)     299
  Revaluation gain (loss)
   from derivatives
   economically hedging
   MSR                                                   358     (636)
  Adjustment to MSR fair
   value for MSR sale                                      -     (157)
----------------------------------------------------------------------
    Home mortgage loan
     servicing revenue,
     net of MSR valuation
     changes and
     derivative risk
     management
     instruments                                         885       33
----------------------------------------------------------------------
      Total revenue from
       sales and
       servicing of home
       mortgage loans                                $   944  $   768
======================================================================

(1) Originated mortgage-backed securities represent available-for-sale
     securities retained on the balance sheet subsequent to the
     securitization of mortgage loans that were originated by the
     Company.

(2) Includes contractually specified servicing fees (net of guarantee
     fees paid to government housing-sponsored enterprises, where
     applicable), late charges and loan pool expenses (the shortfall
     of the scheduled interest required to be remitted to investors
     and that which is collected from borrowers upon payoff).
WM-17
                       Washington Mutual, Inc.
                    Selected Financial Information
                        (dollars in millions)
                             (unaudited)

                                         Quarter Ended
----------------------------------------------------------------------
                         Dec. 31, Sept. 30, June 30, Mar. 31, Dec. 31,
                            2007      2007     2007     2007     2006
----------------------------------------------------------------------
MSR Valuation and Risk
 Management:
  Change in MSR fair
   value due to
   valuation inputs or
   assumptions           $  (390) $   (201) $   530  $   (96) $   (80)
Gain (loss) on MSR risk
 management instruments:
  Revaluation gain
   (loss) from
   derivatives               518       419     (547)     (32)     (33)
  Revaluation gain
   (loss) from certain
   trading securities          -         4       (4)       4       (5)
----------------------------------------------------------------------
    Total gain (loss) on
     MSR risk management
     instruments             518       423     (551)     (28)     (38)
----------------------------------------------------------------------
      Total changes in
       MSR valuation and
       risk management   $   128  $    222  $   (21) $  (124) $  (118)
======================================================================


                                                        Year Ended
----------------------------------------------------------------------
                                                     Dec. 31, Dec. 31,
                                                        2007     2006
----------------------------------------------------------------------
MSR Valuation and Risk
 Management(1):
  Change in MSR fair
   value due to
   valuation inputs or
   assumptions                                       $  (157) $   299
Gain (loss) on MSR risk
 management instruments:
  Revaluation gain
   (loss) from
   derivatives                                           358     (636)
  Revaluation gain
   (loss) from certain
   trading securities                                      4      (55)
  Loss from certain
   available-for-sale
   securities                                              -       (1)
----------------------------------------------------------------------
    Total gain (loss) on
     MSR risk management
     instruments                                         362     (692)
----------------------------------------------------------------------
      Total changes in
       MSR valuation and
       risk management                               $   205  $  (393)
======================================================================

(1) Excludes $157 million downward adjustment to MSR fair value
     recognized in the year ended December 31, 2006.
WM-18
                       Washington Mutual, Inc.
                    Selected Financial Information
                        (dollars in millions)
                             (unaudited)

                                    Quarter Ended
----------------------------------------------------------------------
                  Dec. 31, Sept. 30,  June 30,   Mar. 31,     Dec. 31,
                     2007      2007      2007       2007         2006
----------------------------------------------------------------------
Rollforward of
 Mortgage
 Servicing
 Rights(1)
  Balance,
   beginning of
   period        $  6,794  $  7,231  $  6,507  $   6,193  $     6,288
   Home loans:
    Additions         127       116       592        760          357
    Change in
     MSR fair
     value due
     to payments
     on loans
     and other       (255)     (351)     (401)      (356)        (375)
    Change in
     MSR fair
     value
     due to
     valuation
     inputs or
     assumptions     (390)     (201)      530        (96)         (80)
    Sale of MSR         -         -         -          -            1
   Net change in
    commercial
    real estate
    MSR                 2        (1)        3          6            2
----------------------------------------------------------------------
  Balance, end
   of period     $  6,278  $  6,794  $  7,231  $   6,507  $     6,193
======================================================================
Rollforward of
 Mortgage Loans
 Serviced for
 Others
  Balance,
   beginning of
   period        $463,436  $474,867  $467,782  $ 444,696  $   439,208
   Home loans:
    Additions       7,814     8,700    29,949     44,550       25,833
    Loan
     payments
     and other    (15,739)  (20,716)  (24,213)   (22,469)     (20,744)
   Net change in
    commercial
    real estate
    loans             973       585     1,349      1,005          399
----------------------------------------------------------------------
  Balance, end
   of period     $456,484  $463,436  $474,867  $ 467,782  $   444,696
======================================================================

                  Dec. 31, Sept. 30,  June 30,   Mar. 31,     Dec. 31,
                     2007      2007      2007       2007         2006
----------------------------------------------------------------------
Total Servicing
 Portfolio
   Mortgage
    loans
    serviced for
    others       $456,484  $463,436  $474,867  $ 467,782  $   444,696
   Consumer
    loans
    serviced for
    others         17,379    16,078    14,745     13,645       12,415
   Servicing on
    retained MBS
    without MSR       942       980     1,023      1,082        1,140
   Servicing on
    owned loans   238,344   232,392   218,122    226,217      251,766
   Subservicing
    portfolio         399       418       439        465       84,797
----------------------------------------------------------------------
  Total
   servicing
   portfolio     $713,548  $713,304  $709,196  $ 709,191  $   794,814
======================================================================

                                                  December 31, 2007
----------------------------------------------------------------------
                                                            Weighted
                                                 Unpaid     Average
                                               Principal   Servicing
                                                Balance       Fee
----------------------------------------------------------------------
Mortgage Loans                                             (in basis
 Serviced for                                               points,
 Others by Loan                                            annualized)
 Type
   Agency                                      $ 249,259           31
   Private                                       176,989           57
   Subprime
    mortgage
    channel-home                                  30,236           51
---------------------------------------------------------
  Total mortgage
   loans
   serviced for
   others(2)                                   $ 456,484           42
=========================================================

(1) MSR as a percentage of mortgage loans serviced for others was
     1.38%, 1.47%, 1.52%, 1.39% and 1.39% at December 31, 2007,
     September 30, 2007, June 30, 2007, March 31, 2007 and December
     31, 2006.

(2) Weighted average coupon rate was 6.31% at December 31, 2007.
WM-19
                       Washington Mutual, Inc.
                    Selected Financial Information
                        (dollars in millions)
                             (unaudited)

                                        Quarter Ended
----------------------------------------------------------------------
                         Dec. 31, Sept. 30, June 30, Mar. 31, Dec. 31,
                            2007      2007     2007     2007     2006
----------------------------------------------------------------------
Allowance for Loan
 Losses
  Balance, beginning of
   quarter               $1,889    $1,560   $1,540   $1,630   $1,550
  Allowance transferred
   to loans held for
   sale                    (105)     (217)     (81)    (148)    (158)
  Allowance acquired
   through business
   combinations/other         -         -        -        7       30
  Provision for loan
   losses                 1,534       967      372      234      344
----------------------------------------------------------------------
                          3,318     2,310    1,831    1,723    1,766
  Loans charged off:
    Loans secured by
     real estate:
      Home loans(1)        (105)      (52)     (21)     (35)     (16)
      Home equity loans
       and lines of
       credit(1)           (249)     (104)     (55)     (29)     (13)
      Subprime mortgage
       channel(2)          (277)     (146)    (103)     (40)     (52)
      Home
       construction(3)        -         -       (1)       -       (4)
      Multi-family           (4)        -        -        -        -
      Other real estate      (1)       (1)      (1)       -       (1)
----------------------------------------------------------------------
        Total loans
         secured by real
         estate            (636)     (303)    (181)    (104)     (86)
    Consumer:
      Credit card          (126)     (120)    (106)     (96)     (68)
      Other                  (2)       (2)      (2)      (3)      (3)
    Commercial              (32)      (20)     (15)      (9)      (9)
----------------------------------------------------------------------
        Total loans
         charged off       (796)     (445)    (304)    (212)    (166)
  Recoveries of loans
   previously charged
   off:
    Loans secured by
     real estate:
      Home loans(1)           4         1        1        1        -
      Home equity loans
       and lines of
       credit(1)              4         3        3        3        2
      Subprime mortgage
       channel(2)             4         1       11        1        4
      Home
       construction(3)        2         -        -        -        -
      Other real estate       2         2        -        -        -
----------------------------------------------------------------------
        Total loans
         secured by real
         estate              16         7       15        5        6
    Consumer:
       Credit card           31        14       15       16       18
       Other                  -         -        -        6        3
    Commercial                2         3        3        2        3
----------------------------------------------------------------------
        Total recoveries
         of loans
         previously
         charged off         49        24       33       29       30
----------------------------------------------------------------------
          Net charge-
           offs            (747)     (421)    (271)    (183)    (136)
----------------------------------------------------------------------
  Balance, end of
   quarter               $2,571    $1,889   $1,560   $1,540   $1,630
======================================================================

  Net charge-offs
   (annualized) as a
   percentage of average
   loans held in
   portfolio               1.24 %    0.74 %   0.50 %   0.33 %   0.23 %
  Allowance as a
   percentage of loans
   held in portfolio       1.05      0.80     0.73     0.71     0.72

______________________________
(1) Excludes home loans and home equity loans and lines of credit in
     the subprime mortgage channel.

(2) Represents mortgage loans purchased from recognized subprime
     lenders and mortgage loans originated under the Long Beach
     Mortgage name and held in the investment portfolio. Charge-offs
     in the second quarter of 2007 include $26 million of amounts
     primarily related to uncollected borrower expenses incurred in
     prior periods by and owed to a third party loan servicer.

(3) Represents loans to builders for the purpose of financing the
     acquisition, development and construction of single-family
     residences for sale and construction loans made directly to the
     intended occupant of a single-family residence.
WM-20
                       Washington Mutual, Inc.
                   Selected Financial Information
                        (dollars in millions)
                             (unaudited)

                        Dec. 31, Sept. 30, June 30, Mar. 31, Dec. 31,
                           2007      2007     2007     2007     2006
---------------------------------------------------------------------
Nonperforming Assets
  Nonaccrual
   loans(1)(2):
    Loans secured by
     real estate:
      Home loans(3)      $2,302    $1,452   $  991   $  690   $  640
      Home equity loans
       and lines of
       credit(3)            835       533      378      297      231
      Subprime mortgage
       channel(4)         2,721     2,356    1,707    1,503    1,283
      Home
       construction(5)       56        44       47       41       27
      Multi-family          131       120       69       60       46
      Other real estate      53        49       52       52       51
---------------------------------------------------------------------
        Total
         nonaccrual
         loans secured
         by real estate   6,098     4,554    3,244    2,643    2,278
    Consumer                  1         1        1        1        1
    Commercial               24        22       30       28       16
---------------------------------------------------------------------
         Total
          nonaccrual
          loans held in
          portfolio       6,123     4,577    3,275    2,672    2,295
  Foreclosed assets(6)      979       874      750      587      480
---------------------------------------------------------------------
         Total
          nonperforming
          assets(7)      $7,102    $5,451   $4,025   $3,259   $2,775
=====================================================================

   Total nonperforming
    assets as a
    percentage of total
    assets                 2.17 %    1.65 %   1.29 %   1.02 %   0.80 %

______________________________

(1) Nonaccrual loans held for sale, which are excluded from the
     nonaccrual balances presented above, were $4 million, $7 million,
     $171 million, $195 million and $185 million at December 31, 2007,
     September 30, 2007, June 30, 2007, March 31, 2007 and December
     31, 2006. Loans held for sale are accounted for at lower of
     aggregate cost or fair value, with valuation changes included as
     adjustments to noninterest income.

(2) Credit card loans are exempt under regulatory rules from being
     classified as nonaccrual because they are charged off when they
     are determined to be uncollectible, or by the end of the month in
     which the account becomes 180 days past due.

(3) Excludes home loans and home equity loans and lines of credit in
     the subprime mortgage channel.

(4) Represents mortgage loans purchased from recognized subprime
     lenders and mortgage loans originated under the Long Beach
     Mortgage name and held in the investment portfolio.

(5) Represents loans to builders for the purpose of financing the
     acquisition, development and construction of single-family
     residences for sale and construction loans made directly to the
     intended occupant of a single-family residence.

(6) Foreclosed real estate securing Government National Mortgage
     Association ("GNMA") loans of $37 million, $46 million, $49
     million, $72 million and $99 million at December 31, 2007,
     September 30, 2007, June 30, 2007, March 31, 2007 and December
     31, 2006 have been excluded. These assets are fully collectible
     as the corresponding GNMA loans are insured by the Federal
     Housing Administration ("FHA") or guaranteed by the Department of
     Veterans Affairs ("VA").

(7) Excludes accruing restructured loans of $251 million, $287
     million, $285 million, $355 million and $330 million at December
     31, 2007, September 30, 2007, June 30, 2007, March 31, 2007 and
     December 31, 2006.

    CONTACT: Washington Mutual, Inc.
             Media Contact
             Derek Aney
             206-500-6094 (Seattle)
             212-326-6075 (New York)
             derek.aney@wamu.net
             or
             Investor Relations Contact
             Alan Magleby
             206-500-4148 (Seattle)
             212-702-6955 (New York)
             alan.magleby@wamu.net

    SOURCE: Washington Mutual, Inc.