CtW Investment Group, which invests on behalf of several pension funds, called on directors from Bank of America Corp. and Washington Mutual Inc. to describe steps they took to protect shareholders from mortgage-related risk over the past two years.
If it does not get a "compelling" response, CtW said Tuesday, it will urge shareholders to vote against the six directors at the banks' 2008 annual meetings in April.
CtW made its request in letters to B of A directors Jackie M. Ward, Frank P. Bramble Sr., and Robert L. Tillman; it also wrote Wamu directors Mary Pugh, Stephen E. Frank, and William G. Reed Jr. The directors sit on the companies' board committees overseeing risk and are up for re-election this year.
Spokesmen for Wamu and B of A declined to comment Tuesday.
The addition of the two companies' directors completes what CtW calls its "Subprime Director Focus List" for the 2008 proxy season. CtW previously sent letters to risk-oversight directors at Citigroup Inc., Merrill Lynch & Co. Inc., Morgan Stanley, and Wachovia Corp. The six companies on the CtW list are slated to hold annual meetings in April, and they account for 88% of the $87 billion of subprime mortgage-related losses announced by large U.S. banks in 2007, according to CtW. CtW works with pension funds sponsored by a coalition of workers' unions representing nearly 6 million members. The funds have about $1.4 trillion of assets and are long-term shareholders of the six banking companies that CtW has targeted.
