Bank of America’s (BAC - Free Report) Chief Executive Officer, Brian T. Moynihan received a 15% hike in his total compensation for 2018, after the bank reported record earnings. In a regulatory filing, the company stated that the board of directors has approved his 2018 incentive plan.
Moynihan received total compensation of $26.5 million for 2018, up from $23 million for 2017 and $20 million for 2016.
Of the total compensation, $25 million is in the form of stock grants. This equity incentive marks an increase from $21.5 million paid in 2017.
The remaining $1.5 million is his annual salary, which remained unchanged. Notably, he hasn’t received cash bonus since 2007, although a portion of his stock award will be settled in cash when it vests.
Further, of the total equity incentive that BofA provides, half is performance-based restricted stock units (RSUs), which are paid only if the company meets certain financial goals (including growth in book value and return on assets) over three years. The remaining half is time-based RSUs and does not vary with the performance of the company.
Notably, the compensation hike for Moynihan comes after BofA delivered strong 2018 results. Its results benefited from net interest income growth, primarily driven by higher rates and loan growth, along with prudent expense control and lower corporate tax rates. Also, improving asset quality and rise in deposit balances supported the bank’s profitability despite a tough operating backdrop.
Shares of BofA lost 16.6% in 2018 compared with 18.5% decline for the industry. Significant volatility and investor concerns related to several matters were the main reasons for the share price decline.
Currently, BofA carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Other Wall Street biggies that have announced compensations for CEOs include JPMorgan (JPM - Free Report) , Morgan Stanley (MS - Free Report) and Goldman Sachs (GS - Free Report) , with a hike in the range of 5-10%. Other big banks — Citigroup and Wells Fargo — have not yet revealed the latest compensation.
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