This Day In Market History: Wachovia Buys A.G. Edwards

Each day, Benzinga takes a look back at a notable market-related moment that occurred on this date.

What Happened? On May 31, 2007, Wachovia bought A.G. Edwards for $6.8 billion.

Where The Market Was: The Dow closed at 13,627.64. The S&P 500 traded at around 1,530.62.

What Else Was Going On In The World? In 2007, Apple, Inc. AAPL debuted the iPhone. Major League Baseball published the Mitchell Report, a detailed account of the rampant use of anabolic steroids and human growth hormones among professional baseball players. A gallon of gasoline cost $3.38.

Financial Crisis Craziness Begins: In May of 2007, Wachovia and A.G. Edwards combined to form a financial services company that managed $1.1 trillion in assets at the time. The combined company was the second largest U.S. retail brokerage firm.

After reporting a $2.3 billion profit in the first quarter of 2007, Wachovia reported a massive $8.9 billion loss in the second quarter thanks to its exposure to the subprime mortgage market. When Washington Mutual failed in September of 2007, Wachovia’s stock plummeted 27% and the company lost $5 billion in assets in a single day after a number of large clients withdrew funds en masse.

Within a year and a half of the A.G. Edwards deal, Wachovia’s market cap had fallen by $100 billion. By the time Wells Fargo & Co WFC took over Wachovia in October 2008, the buyout cost them just $15 billion.

Posted In: A.G. Edwardsthis day in market historyWachoviaEducationTop StoriesGeneral

Ad Disclosure: The rate information is obtained by Bankrate from the listed institutions. Bankrate cannot guaranty the accuracy or availability of any rates shown above. Institutions may have different rates on their own websites than those posted on Bankrate.com. The listings that appear on this page are from companies from which this website receives compensation, which may impact how, where, and in what order products appear. This table does not include all companies or all available products.

All rates are subject to change without notice and may vary depending on location. These quotes are from banks, thrifts, and credit unions, some of whom have paid for a link to their own Web site where you can find additional information. Those with a paid link are our Advertisers. Those without a paid link are listings we obtain to improve the consumer shopping experience and are not Advertisers. To receive the Bankrate.com rate from an Advertiser, please identify yourself as a Bankrate customer. Bank and thrift deposits are insured by the Federal Deposit Insurance Corp. Credit union deposits are insured by the National Credit Union Administration.

Consumer Satisfaction: Bankrate attempts to verify the accuracy and availability of its Advertisers' terms through its quality assurance process and requires Advertisers to agree to our Terms and Conditions and to adhere to our Quality Control Program. If you believe that you have received an inaccurate quote or are otherwise not satisfied with the services provided to you by the institution you choose, please click here.

Rate collection and criteria: Click here for more information on rate collection and criteria.