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SCHEDULE 14A INFORMATION
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WASHINGTON MUTUAL, INC.
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(Name of Registrant as Specified In Its Charter)
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TRANSCRIPT OF DIALOGUE ON VIDEO.
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DO THE MATH
GROWTH + VALUE + EXPERIENCE = WAMU
Final Script 4/28/97
KERRY KILLINGER INTRODUCTION
Hi, I'm Kerry Killinger. Since 1990, our company has been executing a
very successful business strategy, strategy based on growth, value and
experience. Let me explain. Not long ago, our company had only a few
offices scattered throughout Washington state.
Today, we are a full-service financial services company with more than
550 offices in nine Western states. This expansion is the result of a
prudent acquisition strategy, as well as a focus on internal growth.
And, during this expansion, we have delivered a superior long-term
return to our shareholders.
Between April 1990, when our current core management team came together,
and the end of 1996, Washington Mutual's total return, including the
reinvestment of dividends, has exceeded that of every company in our
peer group and has more than doubled the return of the Standard and
Poor's Financial Index.
The track record of our management team speaks for itself. Whether it's
entering new markets, expanding our business lines or integrating
acquired institutions, Washington Mutual has an experienced management
team that makes things happen.
On May 12th and 13th you will have the opportunity to meet with this
management team. They'll share with you the technology platform that is
positioning us to improve our efficiency ratios and to expand through
acquisitions. They'll share the strategies that are resulting in
outstanding loan originations and new customer growth. And they'll share
our plans on integrating future acquisitions.
Please take a few moments to view this video and "do the math" for
yourself. You'll see why Growth plus Value plus Experience equals
Washington Mutual, and why you should come to Seattle May 12th and 13th
to hear our story.
1. ATTA ARGHANDIWAL:
I would say that Washington Mutual has a tremendous focus on quality.
That is basically for customers and the quality of employees and the
awareness that we have in the level of service we provide.
2. BRAD DAVIS:
We have a proven track record of building strong brand awareness in all
of our markets, driving high volumes of traffic through our financial
centers and we have a
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skilled and motivated sales force that's cross-selling that customer
into other products and services.
3. LIANE WILSON:
Technology at Washington Mutual is not used for technology's sake.
4. CRAIG QUINN:
What we're doing is we're freeing up our employees' time so that they
can concentrate on their customer and on cross-selling products to those
customers.
5. DEANNA OPPENHEIMER:
Washington Mutual can move in and dominate a new market quicker than any
of our competitors.
6. Graphic: Household & Account Growth
NARRATOR:
Four years ago, Washington Mutual had relationships with more
than 623,000 households. By the end of 1996, through
acquisitions and internal growth, that total had grown to more
than 1.4 million households. In that same period, the Company's
total number of accounts grew from 1.8 million to almost 4
million.
7. DEANNA OPPENHEIMER:
Our consumer banking strategy is predicated on three factors. The first
is a highly incented sales management force that can deliver a broad
array of products and services through financial centers. The second is
integrated marketing that has a strong brand awareness that can drive in
products and services to those centers based on what the customer wants
and what's profitable to the institution. And the third element is a
technology platform that can support and enhance this integrated sales
effort.
8. Graphic: Telephone Customer Service
NARRATOR:
Washington Mutual handles an ever increasing number of customer
calls fielded either by live representatives or the automated
voice response unit, or VRU. At the end of first quarter 1994,
only 53% of those calls were handled by the VRU. Today, that
percentage has grown to more than 83% helping reduce the cost of
customer transactions while improving customer service.
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9. DEANNA OPPENHEIMER:
Washington Mutual has learned that there is a strong consumer appeal to
a consumer bank and that means something that is an alternative to a
traditional thrift that has a very limited product line and a commercial
bank that has a bigger, broader focus of businesses, as well as
individuals.
10. CRAIG DAVIS:
There has been a very good model developed in multi-state lending in
Colorado, in Nevada, in Arizona. We have a very strong lending
franchise combining all these companies.
11. DEANNA OPPENHEIMER:
Washington Mutual is uniquely qualified for this market because of our
decade plus of experience in perfecting the consumer banking strategy.
12. Graphic; Consumer and Total Lending
NARRATOR:
During the past quarter, Washington Mutual experienced a
continued growth in lending. Consumer lending in first quarter
1997 was up 35 percent over first quarter 1996. Total lending
during first quarter 1997 was up 16 percent over first quarter,
moving from 2.96 billion dollars to more than 3.43 billion
dollars.
13. Graphic; Net Change in Total Households
NARRATOR:
Since offering free checking in September 1994, Washington
Mutual has averaged more than 19,000 net new households every
quarter. And these figures exclude households gained through
acquisitions.
14. BRAD DAVIS:
As bank products increasingly become commodities, consumers are looking
more and more to brand character or personality to make a choice about
where they want to do business. And as a result of that, all of our
marketing focuses on our personality.
15. WAMU TV Ad
HAMMERMAN:
The history of the hammer is the history of civilization.
16. WAMU TV Ad
<PAGE> 6
COWBOYS/RODEO GRANDMAS:
Whoa, it's the Rodeo Grandmas from Washington Mutual. Where you fellas
headed?
17. BRAD DAVIS:
We are real people talking to real people about their financial services
needs from consumer research through product development right to our
advertising.
18. ATTA ARGHANDIWAL:
We at American Savings believe that we are very, very lucky to have
Washington Mutual on our side now. The media support that Washington
Mutual can provide and the marketing campaigns that it can provide and
the colorful merchandising that they bring in the branches, I think they
have a tremendous impact. And overall the billboards and everything
that's out there, it's quality work.
19. LAURA RYAN:
The do the math campaign has made the phones ring. On the retail side,
it's bringing in checking accounts. On the lending side, that's a
natural transition to come over and ask about your home loan because
people want to bank in one place.
20. ATTA ARGHANDIWAL:
We have been able to increase net gain by over 30,000 the first three
months of 1997.
21. Graphic: Net New Checking Account
NARRATOR:
In all of the 1996, American Savings Bank had a net gain of
5,754 checking accounts. During the first quarter of 1997
alone, with Washington Mutual marketing programs in place, ASB's
net checking account growth exceeded 30,000 accounts. In the
first quarter of 1996, Washington Mutual's Northwest Operations
gained more than 20,000 net new checking accounts. For the same
period in 1997, that number jumped to more than 34,000. The
total for year end 1996 was more than 117,000 net new checking
accounts.
22. LIANE WILSON:
We're not a technology company. We're a bank and we like to focus on
sales and service, and by having partnerships that give us basic
technologies that we then customize, this is a great advantage to
Washington Mutual.
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23. CRAIG QUINN:
We took IBM's expertise and Washington Mutual's expertise and combined
the two together. What we came up with was the universal work station
which is able to handle all branch functions at any one time in any one
place. What that's done is it's created efficiency for us, helps our
customers out and it makes our employees feel better about the job they
are doing as well. It's probably the most powerful work station that
you're going to see in a financial institution.
24. Graphic: Teller Transaction Productivity
NARRATOR:
In the first quarter of 1994, the average Washington Mutual
Northwest Operations teller handled approximately 1,566
transactions per month. Today, that same teller handles nearly
2,600 transactions per month -- a 66% increase.
25. LIANE WILSON:
Right now, the technology that we have, for example in our loan
origination function, allows us to automatically underwrite loans and to
close a loan in 5 days.
26. MARTIN SANELLI:
It's a one touch and an appraisal is ordered. It's a one touch and the
title is ordered. It's one touch and the credit's ordered. Customers
who are use to seeing credit reports, you know two three days down the
road, now they can see their credit report right there, in minutes.
Typically it takes us about 22-25 minutes with a customer in front of us
to take an application. We are seeing loan approvals in less than 24
hours.
27. LIANE WILSON:
This is the height in the industry of being able to satisfy a customer's
need.
28. Graphic: Operating Efficiency Ratio:
NARRATOR:
Over the past few years, Washington Mutual has continued to improve its
efficiency ratio, helping to increase profitability. During first
quarter 1995, the Company's efficiency ratio sat at 61.35%. By first
quarter 1997, that figure had dropped to 49.1%.
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29. CRAIG QUINN:
When we acquire a bank, the nice thing about our systems is we can put
them all in that new bank at one time and the conversion process is very
simple and very quick and they begin producing as Washington Mutual.
30. MIKE RUSSELL:
So, of all the companies that I've personally worked for, Washington
Mutual has shown the biggest commitment to bringing branches up on line
quickly.
31. Graphic: Increased Services per Household at Newly Acquired Institutions
NARRATOR:
Washington Mutual has a strong track record of improving
services per household at newly acquired institutions. Three
years after acquiring Vancouver Federal, services per household
had increased by 26%. With Crossland Savings, services per
household went up 29%. The same period with Pioneer Savings saw
an increase of 49%. And three years after acquiring Pacific
First Bank, services per household increased by 44%.
32. DEANNA OPPENHEIMER:
One of the key benefits that we offer in our consumer banking strategy
that's unlike any of our competitors is our focus on our incentive
compensation model and what it does is it motivates producers. It causes
them to be able to very quickly see what it takes to produce revenues
that bring profit to their bottom line as well as the Bank's bottom line
and goal-aligns the two.
33. LAURA RYAN:
I like working for one of the top lenders in California. I like being
able to say that when I, when I say I can do something, I can do it and
I've got the support behind me that will back me up to get the job done
and if I can do more volume because of Washington Mutual, then that's
fabulous for me because that means my years just get better and better.
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34. Graphic: Bank Advertising Recall
NARRATOR:
Historically, in King County, Washington, when survey
participates are asked which single financial institution's
advertising comes to mind first, Washington Mutual has run
second to Seafirst. But in November of 1996, after the Rodeo
Grandmas ads aired, Washington Mutual's numbers shot up to 43%
compared to Seafirst's 22%. In the Portland Market the Rodeo
Grandmas campaign was also a hit. Washington Mutual's top of
mind awareness numbers grew to 33%, a record for the Portland
area.
35. DEANNA OPPENHEIMER:
We've risen to the top of the industry by not being the traditional
thrift.
36. CRAIG QUINN:
We can serve more people. We can do it more efficiently. We can drive
down our training costs. We're going to have happier customers. We're
going to have happier employees too because they have the tools that
they need to be able to do their job.
37. BRAD DAVIS:
This is terrific company. The culture is very strong. It's very team
oriented. We work together. We keep focused on the customer. And we make
quick work of it.
38. DEANNA OPPENHEIMER:
Throughout the last several years, banks and thrifts alike have come to
see our platform in the Northwest, what we've developed here. And all of
them walk away saying boy, you have developed what we've been striving
to achieve.
39. Graphic: Do the Math
40. Graphic: Washington Mutual logo
41. Graphic: Disclaimer
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Slide Images Appearing on Video
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Stock Market Performance
4/1/90 - 12/31/96 Comparative Return(a)
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[BAR GRAPH]
WAMU 34 %
NOB 28.5%
CCI 28.4%
WFC 26.2%
BAC 24.5%
KEY 23.8%
USBC 21.5%
NB 18.8%
ONE 18.6%
S&P 15.5%
AHM 14.7%
GWF 14.2%
GDW 14.0%
WFSL 13.9%
Source: Bloomberg
(a) Total return assumes reinvestment of dividends
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Household and Account Growth
[Logo] Washington Mutual
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Household Growth
----------------
[BAR GRAPH]
1993 623,076
1994 652,643
1995 737,258
1996 1,423,341
Account Growth
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[LINE GRAPH]
1993 1,848,679
1994 2,008,846
1995 2,336,295
1996 3,978,954
Household & Account Growth data has not been restated for mergers. Data for
1996 includes ASB.
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Telephone Customer Service
(exclusive of ASB)
[Logo] Washington Mutual
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Total Calls
-----------
[BAR GRAPH]
3-94 408,705
3-95 555,343
3-96 806,377
3-97 1,401,205
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Telephone Customer Service
(exclusive of ASB)
[Logo] Washington Mutual
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Total Calls vs. VRU Calls
[BAR GRAPH]
3-94 408,705 53%
3-95 555,343 70.4%
3-96 806,377 69.3%
3-97 1,401,205 83.2%
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Total Consumer Loan Origination
[Logo] Washington Mutual
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[BAR GRAPH]
Q1-96 $273.6
Q1-97 $369.8 + 35%
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($ in millions)
Figures restated to include ASB.
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Total Loan Origination
[Logo] Washington Mutual
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[BAR GRAPH]
Q1-96 $2.96
Q1-97 $3.43 + 16%
-----
($ in millions)
Figures restated to include ASB.
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Net Change in Total Households
(Exclusive of Acquisitions)
[Logo] Washington Mutual
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[BAR GRAPH]
Q1 Q2 Q3 Q4
1994 -2,727 2,441 6,135 18,475
1995 18,735 12,409 15,810 15,487
1996 12,040 19,646 26,955 27,975
1997 26,709
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Net New Checking Accounts
(American Savings Bank)
[Logo] Washington Mutual
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[BAR GRAPH]
Q1 Q2 Q3 Q4
1996 -2,413 89 2,193 6,063
1997 31,315
1996 Total = 5,754
Q1-97 = 31,315
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Net New Checking Accounts
(Northwest Operations)
[Logo] Washington Mutual
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[BAR GRAPH]
Q1 Q2 Q3 Q4
1996 20,718 29,221 35,506 31,520
1997 34,358
1996 Total = 116,965
Q1-97 = 34,358
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Teller Transaction Productivity
(Northwest Operations)
[Logo] Washington Mutual
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[BAR GRAPH]
Q1-94 1,566
Q1-97 2,597 +66%
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Operating Efficiency Ratio
[Logo] Washington Mutual
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[BAR GRAPH]
Q1-95 61.35%
Q1-96 52.64%
Q1-97 49.10%
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Increased Services per Household
at Newly Acquired Institutions
[Logo] Washington Mutual
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Vancouver Federal 26%
CrossLand Savings 29%
Pioneer Savings 49%
Pacific First Bank 44%
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Bank Advertising Recall
(First Mention Awareness)
[Logo] Washington Mutual
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King County
[BAR GRAPH]
Washington Mutual Seafirst
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1992 25% 32%
1993 24% 41%
1994 25% 34%
1995 20% 32%
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Bank Advertising Recall
(First Mention Awareness)
[Logo] Washington Mutual
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Nov. 1996 King County
[BAR GRAPH]
Washington Mutual 43%
Seafirst 22%
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Bank Advertising Recall
(First Mention Awareness)
[Logo] Washington Mutual
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Nov. 1996 Portland
[BAR GRAPH]
Washington Mutual 33%
Wells Fargo 26%
