NEW YORK (Reuters) - Washington Mutual Inc’s board of directors approved a plan which helps protect its management’s bonus targets from the impact of the subprime loan fallout, according to a filing with U.S. regulators.
The board’s human resources committee on February 26 approved bonus targets, some of which will be calculated to exclude expenses related to business re-sizing or restructuring, foreclosed real estate assets and loan loss provisions other than related to its credit card business.
The filing, made with the Securities and Exchange Commission on Monday, refers to targets for WaMu chief executive Kerry Killinger, chief financial officer Thomas Casey, chief operating officer Stephen Rotella, and retail banking chief James Corcoran.
The board’s committee said in light of the challenging business environment and the need to evaluate performance across a wide range of factors it will take a three-step approach to rewarding its executives including subjectively evaluating company performance in credit risk management.
In January, Seattle-based Washington Mutual said it awarded Killinger 3.2 million stock options for 2008 to provide a “strong incentive to restore shareholder value”.
WaMu’s share price sank 70 percent in 2007 as mortgage losses soared.
WaMu is one of the big players in the thrift lenders industry which suffered a record $5.4 billion loss in the fourth quarter of 2007 as the housing market deteriorated.
Reporting by Yinka Adegoke; editing by Rory Channing