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Washington Mutual Inc. CEO Kerry Killinger announced that WaMu was back on the "path of profitability" and that the housing crisis has had a profound affect on the bank even though it tried to prepare for the crunch. "It has been a very difficult period for all financial institutions. The industry never anticipated the speed in housing prices. We are going to see April 2008 as a turning point in this company's history."
"Nothing like this has occurred since the Great Depression. We raised capital on several occasions, but it has overcome our preparation. Our priority is to raise capital as the capital markets deteriorate," CEO Kerry Killinger said. Killinger announced that Mary Pugh resigned and was not standing for re-election. Activist shareholder CtW Investment Group was asking shareholders to vote against the re-election of Mary Pugh, chairwoman of Washington Mutual's finance committee. "She is not standing for re-election, and we thank her for her time here," Killinger said.
Anne V. Farrell, also a board member, announced she was leaving in March, Killinger said.
TPG Capital's David Bonderman will be joining the board, and a new chairman will be elected. "The governance committee will go through a deliberate process choosing a chairman for that committee in terms of recruiting directors." After announcing its first-quarter results, Steve Rotella, president and COO, said the bank will be refocusing on revising its retail distribution. "We are refocusing and revising the way we participate in the mortgage space. Our retail distribution systems continue to expand our locations. ... We have almost 700 retail stores. ... At the same time we were expanding, we closed underperforming stores in Chicago and Atlanta where results were not up to our standards. ... That franchise is delivering robust revenues that support us and will flow to the bottom line as the credit crunch subsides. Our plan is focused on retail distribution. " Shareholders expressed their dissatisfaction with the board due to a 75% decline in shareholder value. A shareholder said, "WaMu stands for 'what's in it for me,' and the 'Mutual' is gone." The shareholder asked the board to remember shareholder value. "You haven't said what you haven't done. You haven't put forth your problems," said a shareholder who did not reveal his name. "You are the owners; they are employees. Take the company back! Get a nomination for a board that works instead of a board that stands there. I know David Bonderman; he is a partner of mine. I think the deal you made is awful. We have a Bonderman-Killinger combination. You turned away from the Chase proposal because they wouldn't guarantee you your job. You have to do what some real men do when you face a situation like this -- you stand down! I have a number of copies of the lawsuit. Mr. Dillinger, this is going to the jury. I ask you to stand down." - Maria Woehr Categories Deal Video
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