Washington Mutual’s (WM) stock gained 22% in late morning trading Tuesday after Standard & Poor’s said the battered bank can meet its immediate obligations.

The stock rose 44 cents to $2.44.

S&P said the liquidity position in WaMu’s holding company was “currently solidly positioned to meet all of its fixed obligations through 2010, and the bank is operating with adequate capital positions from a regulatory perspective and has demonstrated funding resilience as the deposit franchise has remained stable.”

Nevertheless, S&P cut WaMu’s credit rating to “junk” status, or below investment grade. The rating agency cited the bank’s exposure to bad mortgage debt and its limited financing flexibility in weak markets.

S&P cut WaMu’s holding company’s senior debt rating by three levels to double B minus from triple B minus. It also downgraded senior and subordinated ratings for WaMu Bank by one notch to triple B minus from triple B.

S&P said WaMu’s outlook remained “negative.” Their analysis assumes improved earnings for the second half of 2008, but a loss for the full year.

Earlier this month, WaMu named Alan H. Fishman CEO, replacing Kerry Killinger. Killinger became WaMu’s CEO in 1990 and built the Seattle-based thrift into one of the nation’s largest banks.