NEW YORK – Wachovia Corp. on Wednesday reported a staggering $24 billion loss as it took a goodwill impairment charge of nearly $19 billion ahead of its acquisition by Wells Fargo & Co.

The Charlotte, N.C.-based bank reported a loss after paying preferred dividends of $23.89 billion, or $11.18 per share, in the period ended Sept. 30, compared with earnings of $1.62 billion, or 85 cents per share, a year earlier.

Excluding goodwill impairment of $18.7 billion and merger-related and restructuring expense of $414 million, the bank lost $4.76 billion, or $2.23 per share.

Analysts polled by Thomson Reuters, on average, had expected earnings of 2 cents per share. Analyst estimates typically exclude one-time items.

The bank said its acquisition by Wells Fargo, in an all-stock deal currently valued at about $14 billion, is on track to close in the fourth quarter.

“Wachovia’s third-quarter results were very much in line with our expectations,” said Wells Fargo President and Chief Executive John Stumpf in a statement. “We’re more encouraged than ever by what we’ve seen in their franchise, and we’re pleased that Wachovia’s team continues to focus on serving customers.”

A majority of the $18.7 billion writedown relates to the bank’s retail and small business unit, under which Wachovia’s troubled Pick-a-Pay mortgage portfolio is included. “The unprecedented, almost unimaginable, events of the third quarter and the consideration for our pending merger with Wells Fargo, created a scenario that required goodwill impairment for that and other sub-segments,” said Chief Financial Officer David Zwiener during a recorded message reviewing the quarterly results.

Essentially, Wachovia was forced to write down the value of these assets because they were considered overvalued compared with the market value — or what Wells Fargo was willing to pay. The charge has no impact on Wachovia’s capital levels.

During the quarter, Wachovia set aside a $6.63 billion provision for credit losses, including $3.4 billion to build its reserves to cover losses in its Pick-a-Pay loan portfolio.

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