Updated from Monday, Sept. 22

Investors at Washington Mutual ( WM) are growing increasingly anxious about the fate of the ailing bank, but a resolution could still be some days away.

Washington Mutual shares slumped 20% on Monday, following a Wall Street Journal report that the nation's largest thrift is being pressured by regulators to either sell itself or recapitalize. The Financial Times on late Monday reported that the Office of Thrift Supervision was pushing for a quick resolution to the situation. The regulator could push to broker a deal to split WaMu's assets -- both good and bad -- among several banks.

But as the federal government makes headway on a plan to buy up to $700 billion in bad mortgage assets, potential WaMu suitors may prefer to wait until the plan is more formalized before making a deal, some analysts and other banking industry veterans say.

"The bailout plan made WaMu a more viable acquisition candidate," says Howard Shapiro, an analyst at Fox-Pitt Kelton Cochran Caronia Waller. "If the government takes some of the worst assets then what you're left with is a very attractive branch network and cleaner balance sheet."

Shapiro says there is no immediate risk to WaMu in the next few months and there is time for the government bailout plan to take shape. He says potential buyers likely want to see what exactly would remain on WaMu's books.

"If I were a buyer, I would wait until I have more clarity," he says.

Toronto-Dominion ( TD) is among the companies now weighing a bid for WaMu, the Wall Street Journal reports Tuesday, citing people familiar with the situation.

Last week the Seattle thrift had been reported to put itself on the auction block, with suitors such as Citigroup ( C), JPMorgan Chase ( JPM), Wells Fargo ( WFC) and Banco Santander ( STD) considering a deal, reports say.

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