In this paper, we extend the statistical model-based Estimation-Quantization (EQ) wavelet image coding algorithm introduced in [?] to include an adaptive transform component. For this, we resort to the rich, spacefrequency diverse, and easy-to-search library of transforms provided by the family of wavelet packet (WP) bases and their adaptive extensions. We use ratedistortion criteria to find the best basis jointly with the statistical model-based best adaptive quantization and entropy coding strategy of [?] based on an efficient and fast tree pruning algorithm. A key underlying attribute of our paradigm is that the spatially-varying Generalized Gaussian mixture model for wavelet coefficients introduced in [?] is also applicable to the more arbitrary framework of (adaptive) wavelet packet transform coefficients as well. Our WP-EQ framework produces excellent results on standard test images. The most attractive property of our paradigm is its "universality" and robustness: bas...