East meets west…

January 3, 2005

What happens when a West Coast company looks for East Coast talent? They wind up paying through the nose. Washington Mutual (WM) , the fast growing Seattle-based bank revealed last week — when few were probably paying attention — that Stephen Rotella, a JP Morgan Chase (JPM) executive who oversaw mortgage banking, would receive a $2.6 million signing bonus when he joins the bank next week as president and COO. That’s in addition to a guaranteed bonus of at least $2 million this year (though it could be as high as $2.5 million) and a $900K salary. Rotella’s official hiring letter that was filed last week starts out with a jaunty Congratulations! and bears a passing resemblance to an old Publishers Clearinghouse letter — the type that used to spell out all sorts of fabulous prizes. A quick search of WaMu’s filings shows that it’s only the second time that the company has handed out a signing bonus — the first time was in 2003, when it gave CFO David Casey a $750K. But now that the bar has been set so high, it’s fair to assume that any additional executive hires will also demand hefty signing bonuses.

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