Washington Mutual reported its third straight quarterly loss after the bell on Tuesday, providing the latest evidence of how much damage the credit crisis has inflicted on the nation's banks.

The largest savings and loan in the U.S. lost $3.33 billion, or $6.58 per share, compared to a profit of $830 million, or, 92 per share, a year ago. Washington Mutual (WM) posted an adjusted-loss of $3.34 a share. 

WaMu's results were significantly worse than the $1.05 per share loss analysts polled by Thomson Reuters had been looking for.

Despite the huge miss, shares of surged more than 16% in after-hours trading after initially trading lower. The action comes after financial stocks had a huge day, rallying despite weak earnings from American Express (AXP) and Wachovia (WB). 

Given the company's dismal performance in 2008, WaMu said several of its senior officers will go without annual incentive payments, including  CEO Kerry Killinger, President and Chief Operator Officer Stephen Rotella and Chief Financial Officer Thomas Casey. 

Seattle-based WaMu's second quarter was slammed by an increase in loan loss reserves to $8.46 billion. Still, the bank insisted it has "sufficient capital" to navigate the challenging period. 

During the second quarter WaMu successfully raised $7.2 billion, but failed to stop the bleeding in its stock price, which lost 52% of its value. WaMu has plunged 86% from a year ago.

Also during the period, WaMu also slashed 1,200 jobs, cut its quarterly dividend to a penny from 15 cents and restructured its operations to allow it to leave the wholesale lending business.