Wells Fargo & Co. said Thursday its CEO and three other high-ranking executives won't get cash bonuses for 2009, but the bank's board awarded them performance-based stock awards currently worth a combined $25 million.
The so-called "retention" shares are forfeited if the executives leave the San Francisco-based bank for a competitor. They vest after three years if the company meets certain performance goals. The bank is the largest in South Carolina based on deposits.
Keeping the four executives to lead Wells Fargo in the wake of its acquisition of Charlotte-based Wachovia Corp. is "absolutely essential for the continued long-term success of Wells Fargo," Steve Sanger, chair of the board's Human Resources Committee, said in a statement.
Sanger said the four have led Wells Fargo "through the largest merger integration in U.S. banking history, and they have played key roles in generating record profits in the first three quarters of 2009, despite the challenging economy."
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Wells Fargo is awarding CEO John Stumpf a target of 379,600 shares, currently worth $10 million. Chief financial officer Howard Atkins, wholesale banking head Dave Hoyt and consumer finance head Mark Oman are each getting 189,800 shares, worth about $5 million.
Financial companies have been working to find ways to attract and retain talent as criticism of industry pay practices swells.
Wells Fargo's announcement comes more than four months after the bank increased the four executives' salaries, with the increases paid not in cash, but through issuance of company stock.