WaMu Gives New CEO Mega Payout as Bank Fails

Friday, September 26, 2008


Nice work — if you can get fired from it.
That's just what one Alan H. Fishman might have thought when he woke up Friday morning.
Fishman was the new chief executive officer for Washingon Mutual — WaMu — the
nation's largest savings and loan, which was taken over Thursday night
by federal bank regulators and quickly dumped in a fire sale to
JPMorgan Chase for the Wal-Mart-like price of $1.9 billion.
But
don't cry for Fishman, who reportedly was sky-high — literally — last
night, on a flight from New York to Seattle, when WaMu collapsed. Even
though he's only been on the job for less than three weeks, he's
bailing out with parachute worth close to $20 million, according to an
executive compensation analysis conducted for the New York Times by
James F. Reda Associates.
That's right, $20 million for 17 days on the job ... and his company failed.
Fishman,
who formerly was chairman of Meridian Capital Group, apparently was
much coveted by WaMu, which was counting on him to lead the failing
thrift out of mortgage troubles that pushed the bank to a $3.3 billion
second-quarter loss.


According to filings with
the Securities and Exchange Commission, WaMu threw a $7.5 million bonus
at Fishman when it hired him on Sept. 8, and guaranteed him an
immediate cash severence of $11.6 million — both of which he gets to
keep.
He also was eligible for annual bonuses
of up to 365 percent of his annual base pay — set at $1 million — to go
with millions of shares of company stock.
Fishman does lose out on a big bonus that would have kicked in had he remained on the job through 2009.
Documents
show WaMu was going to pay their new boss $8 million to simply not
screw up and get fired — all negotiated as the Seattle-based banking
giant's loses climbed to an estimated $20 billion.