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Friday, March 19, 2004 - Page updated at 12:00 A.M.
Weekly interest and loan rates | Home values

Northwest stock contest 2004 | Consumer affairs

WaMu executives' pay reflects slump

By Bradley Meacham
Seattle Times business reporter

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Three of Washington Mutual's top five executives saw their salary and bonus stagnate last year, reflecting a slump in demand for loans, but their total compensation packages didn't necessarily fall.

Chief Executive Kerry Killinger received a $1 million salary and a bonus of $2.9 million, slightly lower than a year earlier, according to the company's proxy statement filed with the Securities and Exchange Commission on Wednesday. Other compensation pushed his pay package to $4.8 million last year.

Killinger and the other top executives are also expected to receive long-term stock compensation in 2004 for their performance during the 2001-2003 period, the proxy said. The value of that compensation wasn't specified or included in the 2003 pay totals.

In 2002, with the long-term payments, Killinger received $6.8 million, including a $3 million bonus and long-term stock payments worth $2.1 million.

Craig Tall, head of corporate development, received $1.6 million for 2003 before the long-term stock payments. Vice Chairman Bill Longbrake, whose duties were scaled back, received $1.4 million before long-term stock payments.

Last year's compensation came as a slump in demand for mortgages cut fourth-quarter profit by 11 percent, tempering years of rapid growth. After the downturn began in the third quarter, WaMu lost $271 million on mortgage loans from losses on financial instruments it uses to balance the risk of rate changes.

Craig Davis, who headed the mortgage business until he quit last September after seven years, received a $3.2 million severance payment and $90,054 for accrued vacation, the proxy said. His compensation in 2003 was $5.2 million, up from $2 million in 2002, before long-term payments.

Deanna Oppenheimer, who was promoted to lead the company's consumer operations during the management shake-up last September, saw her compensation rise 16 percent to $1.7 million, before long-term payments.

Among other top executives, Chief Financial Officer Tom Casey saw his total compensation more than double to $3.2 million last year from $1.4 million in 2002. The package included $1.9 million related to his relocation to Seattle in 2002, the proxy said.

Killinger also realized a $2.7 million gain from exercising stock options. He held 4.4 million exercisable options worth $66.4 million at the end of 2003.

Killinger in December received options to buy 760,000 WaMu shares at an exercise price of $39.53. Those options could be worth $47.9 million in 10 years if the stock price rises by 10 percent annually, the proxy said.
 
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WaMu shares fell 10 cents to close at $43.85 yesterday. The shares are down 6.3 percent during the last 12 months compared to a 2.9 percent rise in the Standard & Poor's 500 index during the same period.

Bradley Meacham: 206-515-5066 or at bmeacham@seattletimes.com

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