Big Payday Awaits Chairman After Countrywide Sale
By Frank Ahrens
Washington Post Staff Writer
Saturday, January 12, 2008; Page D01
Angelo R. Mozilo has pocketed $410 million in salary, bonuses and stock-option gains since he became executive chairman of mortgage lender Countrywide Financial in 1999, according to the executive compensation company Equilar.
Now, the man at the center of the national mortgage crisis stands to collect an additional $112 million in severance when Bank of America buys the company he helped found.
Equilar's numbers are based on Countrywide's most recent proxy statement, which is a year old. According to the statement, if Countrywide is acquired and Mozilo leaves, he is entitled to a cash severance of $88 million. He would also receive a retirement package worth $24 million.
Equilar said that most of Mozilo's compensation since becoming chairman -- $285 million -- has come from stock options. Mozilo has been criticized for selling pieces of his stake in Countrywide, cashing in tens of millions of dollars in options as the housing market dropped.
Mozilo, 69, is a native New Yorker and son of a butcher. He graduated from Fordham University in the Bronx in 1960. While in high school, he took a job at a mortgage company and learned the trade as a messenger and file clerk.
Mozilo went to work full time in the mortgage industry right out of college. His first success came during the population boom at Cape Canaveral, Fla., in the 1960s after President John F. Kennedy's announced goal of putting a man on the moon. He wrote loans for aerospace engineers who descended on the cape to work for NASA, and eventually underwrote home loans across Florida.
In 1969, Mozilo launched Countrywide in Calabasas, Calif., with David Loeb, a former boss and mentor. They had a novel storefront business plan that tried to simplify the mortgage process and replace salesmen with bank-like customer service.
Mozilo said that every American who wanted to buy a home ought to be able to buy one -- a sentiment that led to millions of borrowers in recent years getting mortgages they could not afford.
Fortune magazine ranked Mozilo as the 13th-highest-paid male executive in 2006, with a total compensation of $43 million. He does not crack Forbes's list of the 400 richest Americans, however, meaning that his net worth is less than $1.3 billion.
His contract as chairman of Countrywide runs through the end of next year, and he is expected to continue as a non-employee chairman of the board until the end of 2011. During that time, he will receive a director's salary, plus $200,000 a year, office space and the use of the corporate jet for business trips. His country-club dues will also be paid.
Even if Mozilo is fired as chairman, he would receive $400,000 a year to consult until the end of 2011.
Mozilo can expect pressure from shareholders and members of Congress to part with some of his compensation.
In a written statement yesterday, House Financial Services Committee Chairman Barney Frank (D-Mass.) said Mozilo, "who will be profiting from this transaction personally," should "donate a substantial portion of the $150 million he has collected over the last several years to nonprofits and other institutions that are helping us deal with the problem he helped to create."
Countrywide's stock price has fallen 79 percent in the past year, and the Securities and Exchange Commission has been looking at Mozilo's stock sales during the decline. He has said he did nothing wrong.
Mozilo holds an honorary doctorate from Pepperdine University, has been on the board of Home Depot and is a member of the board of trustees of Gonzaga University.
Staff researcher Richard Drezen contributed to this report.
Showing posts with label China Debt. Show all posts
Showing posts with label China Debt. Show all posts
Saturday, December 13, 2008
Tuesday, October 14, 2008
Iceland First?
"...Japan is ready to take leadership in contributing to support countries by providing funds."
"...died a quick death in the face of U.S. opposition..."
"The loans would be funded by 200 billion yen ($2 billion) contributed by IMF member countries plus loans from the foreign currency reserves of Middle Eastern oil exporters as well as the likes of Japan and China, the paper said.
China, which has pledged to cooperate with other countries to tackle the current crisis, has been repeatedly urged by Washington to play a greater role in international financial policy-making commensurate with its economic power..."
Japan stands ready to help the International Monetary Fund ride to the rescue of countries struck down by the global credit crisis, Finance Minister Shoichi Nakagawa said "If there's something the IMF can do, I want them to do it flexibly. Japan will cooperate with that, including providing funds for it," Nakagawa told reporters in Washington on Thursday.
He was speaking on the eve of a meeting of finance ministers and central bank chiefs from the Group of Seven (G7) rich nations, whose support will be crucial if the plan is to work.
"The impact of the credit crisis is spreading to the world. To minimize the chain-reaction, Japan is ready to take leadership in contributing to support countries by providing funds. And I will call for other countries' cooperation at the G7 meeting tomorrow," Nakagawa said.
"Japan alone has $995 billion in official foreign currency reserves. China has $2 trillion, the world's largest stockpile."
The Nikkei newspaper reported that Japan would propose making trillions of dollars in currency reserves held by Asian and Middle Eastern governments available to support IMF-led bailouts.
Japan alone has $995 billion in official foreign currency reserves. China has $2 trillion, the world's largest stockpile. The Nikkei said the IMF program would be available to smaller emerging countries but not to members of the G7 -- the United States, Japan, Britain, France, Germany, Canada and Italy -- or to other large nations.
"What the IMF should think about is not G7 or G8 countries, but about contingencies that may arise in newly emerging economies and other areas at this time of financial crisis, credit crunch and the dollar's exchange rate," Economics Minister Kaoru Yosano said in Tokyo.
The G8 is made up of the Group of Seven plus Russia.
Japan also took the diplomatic initiative during the 1997/98 Asian financial crisis, proposing the creation of an Asian Monetary Fund to help the region recover from a meltdown that plunged several countries into a deep recession.
The plan died a quick death in the face of U.S. opposition.
Iceland First?
Prime Minister Taro Aso, speaking in Tokyo, said Japan would propose at Friday's G7 meeting that Iceland be helped via the IMF -- an idea that the north Atlantic island has so far resisted.
However, Prime Minister Geir Haarde warned this week that Iceland faced the risk of national bankruptcy because of the crisis, which has forced the government to seize control of the country's three biggest banks.
Under the Japanese plan, the IMF would ask the borrowing country to draw up a plan to revitalise its financial sector including writing off its bad assets, the Nikkei said.
It was not clear how -- or if -- this would differ from the conditions the IMF usually sets in return for an emergency loan.
The loans would be funded by 200 billion yen ($2 billion) contributed by IMF member countries plus loans from the foreign currency reserves of Middle Eastern oil exporters as well as the likes of Japan and China, the paper said.
China, which has pledged to cooperate with other countries to tackle the current crisis, has been repeatedly urged by Washington to play a greater role in international financial policy-making commensurate with its economic power.
But Beijing has given no indication that it is willing to mobilize its reserves in the way that Japan -- its big regional political rival -- is suggesting.
The Group of 20 countries, which brings together key rich and developing economies, will meet in Washington on Saturday during the IMF/World Bank annual meetings and could provide a forum to air the Japanese proposal.
The IMF said it was ready to lend to countries hit by the global credit crunch and had activated an emergency financing mechanism first during the Asian financial crisis a decade ago.
IMF Managing Director Dominique Strauss-Kahn told a news conference it would provide financial assistance not only to emerging and developing nations, but also to Western countries.
"Nobody knows if some ... advanced economies will not also be in need of some help by the IMF," he said, adding that funds would be made available quickly to countries in need. "Very quickly means two weeks at most," he added.
The Fund already sent a mission to Iceland.
Copyright 2008 Reuters. Click for restrictions
"...died a quick death in the face of U.S. opposition..."
"The loans would be funded by 200 billion yen ($2 billion) contributed by IMF member countries plus loans from the foreign currency reserves of Middle Eastern oil exporters as well as the likes of Japan and China, the paper said.
China, which has pledged to cooperate with other countries to tackle the current crisis, has been repeatedly urged by Washington to play a greater role in international financial policy-making commensurate with its economic power..."
Japan stands ready to help the International Monetary Fund ride to the rescue of countries struck down by the global credit crisis, Finance Minister Shoichi Nakagawa said "If there's something the IMF can do, I want them to do it flexibly. Japan will cooperate with that, including providing funds for it," Nakagawa told reporters in Washington on Thursday.
He was speaking on the eve of a meeting of finance ministers and central bank chiefs from the Group of Seven (G7) rich nations, whose support will be crucial if the plan is to work.
"The impact of the credit crisis is spreading to the world. To minimize the chain-reaction, Japan is ready to take leadership in contributing to support countries by providing funds. And I will call for other countries' cooperation at the G7 meeting tomorrow," Nakagawa said.
"Japan alone has $995 billion in official foreign currency reserves. China has $2 trillion, the world's largest stockpile."
The Nikkei newspaper reported that Japan would propose making trillions of dollars in currency reserves held by Asian and Middle Eastern governments available to support IMF-led bailouts.
Japan alone has $995 billion in official foreign currency reserves. China has $2 trillion, the world's largest stockpile. The Nikkei said the IMF program would be available to smaller emerging countries but not to members of the G7 -- the United States, Japan, Britain, France, Germany, Canada and Italy -- or to other large nations.
"What the IMF should think about is not G7 or G8 countries, but about contingencies that may arise in newly emerging economies and other areas at this time of financial crisis, credit crunch and the dollar's exchange rate," Economics Minister Kaoru Yosano said in Tokyo.
The G8 is made up of the Group of Seven plus Russia.
Japan also took the diplomatic initiative during the 1997/98 Asian financial crisis, proposing the creation of an Asian Monetary Fund to help the region recover from a meltdown that plunged several countries into a deep recession.
The plan died a quick death in the face of U.S. opposition.
Iceland First?
Prime Minister Taro Aso, speaking in Tokyo, said Japan would propose at Friday's G7 meeting that Iceland be helped via the IMF -- an idea that the north Atlantic island has so far resisted.
However, Prime Minister Geir Haarde warned this week that Iceland faced the risk of national bankruptcy because of the crisis, which has forced the government to seize control of the country's three biggest banks.
Under the Japanese plan, the IMF would ask the borrowing country to draw up a plan to revitalise its financial sector including writing off its bad assets, the Nikkei said.
It was not clear how -- or if -- this would differ from the conditions the IMF usually sets in return for an emergency loan.
The loans would be funded by 200 billion yen ($2 billion) contributed by IMF member countries plus loans from the foreign currency reserves of Middle Eastern oil exporters as well as the likes of Japan and China, the paper said.
China, which has pledged to cooperate with other countries to tackle the current crisis, has been repeatedly urged by Washington to play a greater role in international financial policy-making commensurate with its economic power.
But Beijing has given no indication that it is willing to mobilize its reserves in the way that Japan -- its big regional political rival -- is suggesting.
The Group of 20 countries, which brings together key rich and developing economies, will meet in Washington on Saturday during the IMF/World Bank annual meetings and could provide a forum to air the Japanese proposal.
The IMF said it was ready to lend to countries hit by the global credit crunch and had activated an emergency financing mechanism first during the Asian financial crisis a decade ago.
IMF Managing Director Dominique Strauss-Kahn told a news conference it would provide financial assistance not only to emerging and developing nations, but also to Western countries.
"Nobody knows if some ... advanced economies will not also be in need of some help by the IMF," he said, adding that funds would be made available quickly to countries in need. "Very quickly means two weeks at most," he added.
The Fund already sent a mission to Iceland.
Copyright 2008 Reuters. Click for restrictions
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