WaMu CEO Fishman walks with $19 million

[SnookAU]

For only 17 days of work!

Unbelievable.  No wonder we're in a "financial crisis".

http://latimesblogs.latimes.com/laland/2008/09/wamu-moolah-ceo.html

[olafberserker]

there in lies the problem.

[SnookAU]

Blaming TINY minority of banking executives for all our problems is plain stupid.  Unfortunately the people that carry most of the blame are ordinary Americans that over stretched themselves or speculated in real estate.  It was too easy to borrow money, which is the banking industry and governments fault BUT they haven't defaulted on mortgages.

Fishman had a contract, and it was honored.  Washinbton Mutual head hunted him, and I am sure he wasn't fully aware of their position until a couple of weeks into the job.  He might actually follow RobertWillumstad's (AIG) example and walk away without compensation.

Where did I blame this for "all of the problems"? 

If you think a guy getting (and accepting) $19 million for less than a month of work, then you're out of your mind.

And to say he wasn't fully aware of their position is just plain laughable.  I was pretty aware of WaMu's situation... AND I'M NOT EVEN THE CEO.

[olafberserker]

He should have been well aware of the situation.  Someone of that level knows what he is getting into when he signs on or at least he should.  

The banks/lenders were giving away money because they were making TONS of it.  The system was the problem.  The way things were done and were allowed to occur was the problem.  That system allows a guy in charge of a sinking ship to walk away with $19 million dollars while the banking system is about to completely collapse and those Average Joes are losing their jobs is the problem.  While average joes have their responsibility in this don't tell me that the average joe who is trying to buy a home for his family is at fault alone when the banks are doing everything in their power to put them into that home without any regard for teh potential consequence.  

The system was/is the problem.

[T-Bone]

They are giving away money because of the bankrupsy. After the official bankrupt filing all the money goes back to creditors ~debt and bond holders first and stocks lastly(except for 19 million of course).

[ufojoe]

And to say he wasn't fully aware of their position is just plain laughable.  I was pretty aware of WaMu's situation... AND I'M NOT EVEN THE CEO.

OK...in two or three sentences explain what happened to WM in the last few weeks.

A few weeks before the FDIC forced the sale to JP, Fishman came out and said that WaMu had enough capital
to last until 2010 and made no mention of deposits being pulled. He lied and share holders took a bath. IN
the end, depositers were withdrawing money in large amounts (10% in the last two weeks) and the FDIC
claimed that WaMu was teetering on disaster.

I have more of a problem with Fishman's  statement to shareholders and the media than I do with his
agreed upon bonus. He has yet to be heard from since the forced sale and nobody even knows if he
works for WaMu any more.

A part of me feels that the FDIC stepped in and made the WaMu story front page news to scare our
congress folks into supporting the bailout bill. Conspiracy...

It hasn't worked. Yet...

* * * * *

http://seattletimes.nwsource.com/html/businesstechnology/2008220153_webfishman02.html?syndication=rss

Alan Fishman, named Washington Mutual's CEO just 18 days before it was seized by federal regulators, will not accept a severance payment even if he is entitled to it, a spokesman representing him said Wednesday in an interview.

"It is doubtful that Mr. Fishman would be entitled to severance payments under his contract because of FDIC regulations, but in any event, he would not accept severance under these circumstances," the spokesman said.

He would not comment on whether Fishman would keep a $7.5 million signing bonus or whether he is still employed at WaMu. The nation's largest thrift was taken over Sept. 25 by the Federal Deposit Insurance Corp., which sold most of it to JPMorgan Chase.

Fishman's employment contract made him eligible for $11.6 million in cash severance, according to James F. Reda & Associates, a compensation-consulting firm in New York.

[mtnman]

Blaming TINY minority of banking executives for all our problems is plain stupid. Unfortunately the people that carry most of the blame are ordinary Americans that over stretched themselves or speculated in real estate. It was too easy to borrow money, which is the banking industry and governments fault BUT they haven't defaulted on mortgages.

Fishman had a contract, and it was honored. Washinbton Mutual head hunted him, and I am sure he wasn't fully aware of their position until a couple of weeks into the job. He might actually follow RobertWillumstad's (AIG) example and walk away without compensation.

I suppose predatory lending practices, rising prices and folks losing their jobs, basically the erosion of the middle class, have nothing to do with it. 

[SnookAU]

And to say he wasn't fully aware of their position is just plain laughable.  I was pretty aware of WaMu's situation... AND I'M NOT EVEN THE CEO.

OK...in two or three sentences explain what happened to WM in the last few weeks.

Sentences?  How bout two WORDS?

BAD MORTGAGES.

WaMu's been in bad shape for awhile now.  Where have you been?

[olafberserker]

Is this what you're fishing for?


David Enrich: “The first is that depositors over the past couple weeks have pulled out something roughly approaching 10 percent of WaMu’s total deposits, about $16 billion. I don’t think there is any indication that was stabilizing. The other problem though is that there were some leaks that were starting to come out in press that this was in the works. And the regulators, that’s their worst nightmare.�

[SnookAU]

From APRIL OF 2007:

Note the words "executives", "bottom line effect" and "income statement".

http://seattlepi.nwsource.com/business/312011_wamu18.html

Executives also said that the well-publicized industrywide problem in subprime lending is obscuring continued strong performance in other segments of its business, including retail banking, credit cards and commercial lending.

Still, the company acknowledged the considerable bottom-line effect of what Chief Executive Kerry Killinger called "unprecedented deterioration in the subprime mortgage business," which consists of making loans to people with less attractive credit records or financial status than prime borrowers.

That deterioration hits WaMu's income statement several ways: Higher delinquencies on loans, higher allocations for loan-loss reserves, losses on the sale of subprime loans and declines in the value of loans still held on the books.



Hmmmm....

Sounds like those "BAD MORTGAGES" were the beginning of the end.

Thank you and good night.