Holder Group Wants to Boot Two WaMu Directors

Critics, including CtW, are questioning WaMu's compensation packages for its top executives, including Killinger, in light of the hard times that the bank has fallen on as the housing crisis worsened.

While Killinger declined to accept a cash bonus for 2007 and other executive bonuses were significantly cut, critics are wondering why the company didn't include more objective targets to measure credit performance among the four components on which this year's cash bonuses will be based.

WaMu recommends that shareholders vote for the directors because of their record of "skill, diligence, and deep understanding of our company," it said in a statement. "They know what we need to do to address the challenges that lie ahead and restore value to our shareholders."

"With board oversight, WaMu took significant steps to reduce interest rate risk and to tighten credit risk management in recent years," the company said. WaMu "also moved aggressively to address the challenges created by the historic deterioration in the credit markets since mid-2007."

In addition, "the 2008 [compensation] plans establish appropriate incentives for management to improve performance, including credit performance, and hold management accountable if it does not. This is precisely what the board did in 2007 when management compensation was reduced dramatically," WaMu said.

CtW has been vocal about what it perceives as abuses at several other financial firms sideswiped by the housing crisis.

Earlier this month, the group told shareholders of Morgan Stanley(MS Quote) to vote against two directors at its annual meeting. CtW also believes that the New York-based brokerage firm's top dog, John Mack, shouldn't serve as chairman and CEO at the same time.

Last year, CtW took aim at Countrywide Financial(CFC Quote) for its excessive compensation practices with regards to its CEO Angelo Mozilo.

Countrywide -- perhaps the poster child for the demise of the subprime mortgage industry last year -- agreed in January to be sold to Bank of America(BAC Quote) for $4 billion.