Washington Mutual Strips Killinger's Chairman Role

Washington Mutual, the large bank and home lender slammed by the mortgage slump, said Monday that it would strip Chief Executive Kerry Killinger of his title of chairman starting next month.

The Seattle-based savings & loan said independent director Stephen Frank would become chairman of the board on July 1. Killinger, who has presided over WaMu amid a plunging stock price and earnings, will remain CEO.

Frank, 66, has been a director since 1997 and is the retired CEO of utility company Southern California Edison, a subsidiary of Edison International.

WaMu said in April that it would consider splitting the CEO and chairman roles at a future board meeting. Angry stockholders have agitated for management changes at the bank, whose shares have plunged 79 percent during the past year.

The board shake-up comes the same day Wachovia said it had ousted Ken Thompson as CEO after a host of troubles and an ill-timed takeover of a big mortgage lender dragged down its earnings and its stock.

Last month Wachovia , the fourth-largest U.S. bank, split its CEO and chairman roles. On Monday Lanty Smith, who replaced Thompson as chairman, was named interim CEO.

Charlotte, North Carolina-based Wachovia said Thompson, who had run the company since April 2000, was retiring at the request of its board.

Killinger and Thompson join a growing list of banking chiefs whose careers were derailed by the global credit crisis that began last summer. Citigroup Inc's Charles Prince and Merrill Lynch & Co.'s Stanley O'Neal also were forced out by their boards.

Also on Monday, Washington Mutual revised its rules so that director nominees must receive a majority of votes cast in uncontested elections. It also changed the leadership of key board committees and announced a search for new independent directors.

Shares of Washington Mutual fell 12 cents, or 1.3 percent, to $8.90 in morning New York Stock Exchange trade.