Published March 28, 2013
Bank of America Corp's co-chief operating officer, Tom Montag, was once again the bank's highest paid executive in 2012, making $14.5 million in a year in which the bank showed signs of healing.
Montag's compensation, which included a $5.46 million bonus and $8.19 million in stock, increased 21 percent to eclipse the $12 million awarded to Chief Executive Brian Moynihan, according to a filing the bank made on Thursday with the U.S. Securities and Exchange Commission.
Bank of America's executives were handed bigger pay packages in 2012 as the No. 2 U.S. bank by assets made progress in recovering from the 2007-2009 financial crisis. Its shares climbed more than 100 percent in 2012, while the bank padded its capital holdings and made strides in resolving mortgage-related litigation.
In his annual letter to shareholders, which was posted on the bank's website on Thursday, Moynihan struck an optimistic tone, saying the company had been "transformed" by a stronger balance sheet and a focus on core customers.
The letter also signaled Moynihan's plans for rewarding shareholders by buying back more stock. Earlier this month, the bank passed the Federal Reserve's annual stress test and won permission to repurchase $5 billion of its own shares.
"We are well-positioned to return excess capital to our shareholders and we believe that buying back common shares is the best way to continue to drive value for our shareholders," Moynihan wrote.
As part of this year's stress test, the bank did not request an increase in its quarterly dividend, which has been stuck at a penny per share since the financial crisis.
Moynihan, whose compensation was disclosed last month, was the bank's second-highest-paid executive after his total rose more than 70 percent to $12 million thanks to a higher stock grant of $11.1 million. He did not receive a cash bonus.
Montag, who runs global banking and markets businesses, has made more money than the CEO since joining Bank of America through its 2009 acquisition of Merrill Lynch & Co. In 2012, he also earned more than the CEOs at JPMorgan Chase & Co and Morgan Stanley .
Bank of America Chief Financial Officer Bruce Thompson made $11 million, followed by co-Chief Operating Officer David Darnell ($9.5 million) and general counsel Gary Lynch ($7 million), according to the filing.
For 2013, the bank is increasing Moynihan's salary by 58 percent to $1.5 million and upping the base pay for Montag and Darnell by 18 percent to $1 million.
Thursday's proxy filing also disclosed that five of the bank's 18 directors will not stand for election at this spring's shareholder meeting as part of a board shuffle that began last summer.
Three directors who were at or near the retirement age of 72 - Virgis Colbert, Donald Powell and Charles Rossotti - are departing, joining two other directors - Robert Scully and Mukesh Ambani - who had previously announced they were leaving.
The exits are the latest reshaping of the bank's board, which will shrink to 13 members.
In 2009, federal regulators pressed the bank to add directors with more financial expertise after the company required multiple bailouts during the financial crisis. Of those six board members, only former Federal Reserve Governor Susan Bies and former DuPont CEO Chad Holliday remain.
In anticipation of retirements, the bank has added six new board members since August, all of whom will stand for election at the May 8 shareholder meeting. Four of the new directors were found through a search firm and two others were identified by Holliday, the board's chairman, according to the filing.
(Reporting by Rick Rothacker in Charlotte, N.C.; Editing by Steve Orlofsky, Bernard Orr)