Dive Brief:
- Bank of America cut CEO Brian Moynihan’s compensation by 6.3% in 2022 — to $30 million, from $32 million, according to a Securities and Exchange Commission filing Friday.
- The decrease comes after net income at Bank of America fell 14% over the year to $27.5 billion, from 2021’s record $32 billion. Last year’s total, however, is still the bank’s third-highest on record, BofA said.
- Moynihan’s $30 million total means he will likely become the third highest-paid CEO among the top six U.S. Wall Street banks, behind JPMorgan Chase’s Jamie Dimon, who made $34.5 million in 2022, and Morgan Stanley’s James Gorman, who made $31.5 million.
Dive Insight:
Moynihan’s pay breaks down to a $1.5 million base salary and $28.5 million in restricted stock units. Half of those will be re-earned only if the bank meets specific performance standards between now and 2025; 30% will vest over the next year; and 20% will vest annually over the next four years.
At least one of the bank’s performance indicators is showing bounce-back. Bank of America’s stock price has rebounded 10% so far in 2023, after falling 26% last year, according to Bloomberg.
Despite last year’s dip in profit, revenue climbed 7% in 2022, the bank said. And against other top-six banks, Bank of America’s profit dropped considerably less: 14%, compared with 22% at JPMorgan Chase, 27% at Morgan Stanley and nearly 39% at Wells Fargo.
In its filing, the bank touted several of its success stories: Bank of America added 1 million net new consumer checking accounts and 3 million active new digital banking users, raised more than $700 billion on behalf of clients, and added 28,000 net new relationships in wealth management, it said.
The bank also raised its minimum hourly wage to $22 — another step on its goal toward $25 per hour by 2025. It introduced paid sabbaticals for employees who have worked with the bank for 15 years or more. And it awarded restricted-stock bonuses to 96% of its staff, it said.
Moynihan’s pay cut comes a year after the bank boosted his compensation by 30.6%. His $2 million slide mirrors a pay cut he saw in 2020, when the COVID-19 pandemic gripped the world and profit at Bank of America dropped 35%.
As yet, none of the six largest U.S. banks has given its CEO a pay boost for 2022. Compensation for Dimon and Wells Fargo’s Charlie Scharf stood pat (though Scharf preemptively turned down a raise, according to Wells). Gorman saw a 10% pay cut. And Goldman Sachs slashed CEO David Solomon’s compensation by 28.6%.
Citi could play the spoiler. It will be the last of the top-six banks to report CEO pay, and 2022 marked the first full calendar year with CEO Jane Fraser at the helm. With that in mind, it’s entirely possible the bank would bump her pay from the $22.5 million she made in 2021.
