Bank of America CEO Brian Moynihan was awarded $12 million in base salary, stock awards and other compensation for his 2012 performance, the Charlotte bank disclosed Thursday. It was a 70 percent jump from what Moynihan was awarded the year before.
In 2011, Moynihan was awarded $7 million in total compensation, down from $10 million in 2010.
The boost in compensation is based in part on the banks increasing profits and progress toward resolving mortgage-related woes, the bank said Thursday in a filing with the Securities and Exchange Commission.
Moynihan, 53, again found himself being paid less than one of his subordinates. Co-Chief Operating Officer Thomas Montag, based in New York, was awarded $14.5 million in total compensation for last year, up from $12 million the year before. Montags Charlotte-based counterpart, David Darnell, was awarded $9.5 million, up from $8 million.
Moynihans pay also continues to lag that of his peers at other big banks. Last year, Wells Fargo CEO John Stumpf made $22.8 million and JPMorgan Chases Jamie Dimon made $18.7 million. But Moynihans compensation was close to that of Citigroup CEO Michael Corbat, who earned $12.4 million in 2012.
Moynihans 2012 compensation included base salary of $950,000. Half of his 2012 incentive compensation is composed of performance-contingent stock awards.
Under Moynihans leadership in 2012, Bank of America continued to strengthen and simplify its balance sheet, including through the sale of our international global wealth investment management business, the bank said in the filing.
Bank of Americas profit in 2012 was $4.2 billion, up sharply from $1.4 billion in 2011. In 2010, the bank reported a loss of $2.2 billion.
Moynihans base salary was increased to $1.5 million effective in February, up from the $950,000 level where it had remained since 2010, his first year as CEO. Darnell and Montags base salaries each went to $1 million from $850,000.
The pay raises come after a year in which Bank of Americas stock price led the Dow Jones Industrial Average. The stock closed Thursday at $12.18, down less than 1 percent. The nations second-largest lender by assets also has settled several major lawsuits that have crimped earnings. But uncertainty remains about its future mortgage-related liabilities.
Around May, the bank is expected to find out whether a judge will approve its proposed $8.5 billion settlement with roughly two dozen investors over losses related to its 2008 purchase of Countrywide Financial Corp. Also, government-sponsored mortgage giant Freddie Mac this month sued Bank of America and other large international banks, saying they rigged the London interbank offered rate, or Libor. Its not clear how much that could cost Bank of America if theres a ruling in Freddies favor.
But the banks board appears pleased with how Moynihan has navigated such issues.
Under Mr. Moynihans leadership, our company made significant progress on resolving legacy mortgage-related issues, reaching key settlements and reducing our ongoing exposure to residential mortgage and discontinued real estate portfolios, according to Thursdays filing.
The amount Moynihan was awarded for 2012 differs from what he actually took home, thanks to how executive compensation is doled out over time. He made $7.4 million last year -- slightly lower than the $7.5 million he took home in 2011 despite the banks dramatic stock price improvement. The $12 million he was awarded in 2012 will be given out over the next several years as stock awards vest.
As was the case in 2011, in 2012 Moynihan was not awarded an annual cash bonus, while other top Bank of America executives were. For example, Montags bonus in 2012 was $5.5 million.
The bank also said Thursday that it has a new compensation policy that requires Moynihan to hold onto a percentage of the Bank of America shares hes awarded until a year after he retires, which puts more accountability pressure on him in the year before he leaves the company.
Previously, Moynihan had to hold at least 500,000 shares of our common stock and retain at least 50 percent of the net after-tax shares from future equity awards until retirement, the bank reported Thursday.
This one-year post-retirement retention requirement further strengthens the alignment of stockholders and the chief executive officers interests.
Also, under another new requirement outlined Thursday, all other Bank of America executive officers must hold onto a percentage of the shares they have been awarded until their retirement.
Moynihan, in an interview this week with public televisions Charlie Rose, said the company has a succession plan, but he could see himself being Bank of Americas CEO the rest of my life.
Dunn: 704-358-5235 Twitter: @andrew_dunn
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