Washington Mutual this week launched a new production funding vehicle that will tap European investors as an alternative to Federal Home Loan Bank advances and traditional securitization. WaMu’s new $26 billion covered bond program features debt collateralized by U.S. residential mortgage collateral, according to a presale report by Standard & Poor’s, which gave a preliminary tri-ple-A rating to the bonds. Covered bonds are senior debt obligations that are secured by specific assets...