Washington Mutual (WaMu) announced today that it had driven out its longtime CEO in response to a consistent decline in stock value over the past year. Kerry Killinger, who became chief executive of the savings and loan bank in 1990 and led it to become the country’s largest, will be replaced by Alan Fishman, chairman of Meridian Capital Group and a former executive at Sovereign Bank.
Killinger’s forced retirement comes as the latest cut in a series of personnel changes facing the nation’s larger lenders in the midst of the subprime mortgage crisis. WaMu’s stock value has plummeted in the past year from around $40 a share to Monday’s opening value of $4.27/share. Killinger became a popular target when he predicted that WaMu would likely suffer losses of anywhere between $12 billion to $19 billion in 2008.
WaMu also revealed this morning that it had reached a memorandum of understanding with the Office of Thrift Supervision (OTS), an agency of the U.S. Treasury that regulates federal thrifts. As part of the agreement, WaMu must “provide the OTS an updated, multi-year business plan and forecast for its earnings, asset quality, capital and business segment performance. The business plan will not require the company to raise capital, increase liquidity or make changes to the products and services it provides to customers.”
Killinger began his career at WaMu in 1982 as executive vice president. He was both CEO and chairman until the roles were split earlier this year. American Banker magazine named him “Banker of the Year” in 2001.