ITEM 8.01. Other Events.
Bank of America Corporation ("Bank of America" or the "Company") today announced
that its Board of Directors (the "Board") has approved 2022 total compensation
for Chair and Chief Executive Officer Brian T. Moynihan of $30,000,000, compared
to 2021 total compensation of $32,000,000.
In determining this compensation, the independent members of the Board evaluated
many aspects of the Company's performance in delivering Responsible Growth in
2022.
The tenets of Responsible Growth encompass each aspect of Bank of America's
financial performance/shareholder return and its continued support of clients,
communities and its employees. The Board acknowledged the Company's continued
success in 2022 and Mr. Moynihan's leadership under this operating model
particularly in this period of considerable economic uncertainty.
Shareholders. The Company earned $27.5 billion in net income in 2022. Revenue
growth of 7% from 2021 outpaced expense growth and created 400 bps of operating
leverage. This was the third highest net income performance in the Company's
history. The Company returned $12 billion to shareholders in 2022 through
dividends and common stock repurchases. The Company's balance sheet remained a
source of strength, with more than $273 billion in shareholders' equity and
liquidity levels of $881 billion at the end of 2022. The Company's common stock
price declined 26% in 2022, consistent with the KBW Bank Index, reflecting
weakened investor sentiment given geopolitical tensions and recessionary fears.
Employees. The Company continued to invest in being a great place to work in
2022. The Company raised the minimum hourly rate of pay for U.S. teammates to
$22/hour continuing its commitment to increase that rate to $25/hour by 2025.
Enhanced benefits offered by Bank of America included continued support for
childcare reimbursement and back-up care programs, as well as elder care. The
Company also further enhanced its mental health wellness programs and launched a
new sabbatical program for employees celebrating certain career milestones,
starting at 15 years of service, beginning in 2023. Additionally, the Company
recently announced the sixth year of Sharing Success awards since 2017 with
approximately 96% of employees receiving an award, the majority will receive
shares of the Company's common stock, further aligning interests with
shareholders.
Clients. The Company continued to support clients in 2022 with credit, capital
and liquidity. The Company raised more than $700 billion of capital on behalf of
clients, as well as increased new commercial commitments by more than $300
billion. This drove loan growth of more than $66 billion in 2022. Importantly,
the Company experienced organic growth across its businesses. In 2022 the
Company added more than one million net new consumer checking accounts with
Consumer investment accounts growing to 3.5 million. The Company's wealth
management businesses added nearly 28,000 net new relationships in 2022 and
added nearly 120,000 new bank accounts for investment clients in 2022.
Additionally, Global Markets achieved its highest sales and trading revenue in a
decade. The Company also continued to see strong client engagement across its
digital platforms adding nearly three million active digital banking users in
2022, growing to 44 million.
Communities. The Company continued to share success with the communities it
serves. The Company provided more than $350 million in philanthropic investments
to drive economic mobility, including $94 million for basic needs like hunger
relief. The Company continued to deliver on its commitment to help diverse
entrepreneurs thrive, ultimately driving economic opportunity and investment in
its communities. The Company's current $430+ million portfolio of more than 130
funds will ultimately invest in more than 2,000 minority- and women-led
companies over the next five years. Additionally, over the course of 2022,
employees gave nearly two million volunteer hours and directed more than $68
million in combined individual giving and the Company's matching gifts,
volunteer grants and other employee-directed giving programs.
The Company was recognized in 2022 as the World's Best Bank by Euromoney.
Compensation Structure. The Board determined that Mr. Moynihan's compensation
structure continues to be composed of base salary, time-based restricted stock
units ("RSUs"), and performance RSUs. Mr. Moynihan's annual base salary remains
$1.5 million. The aggregate value of his 2022 equity incentive awarded by the
Board is $28.5 million. Consistent with prior years, there is no cash bonus. The
incentive is comprised 30% of cash-settled RSUs that will vest over the next 12
months, 20% of stock-settled RSUs that will vest annually over the next four
years, and 50% of performance RSUs that will be re-earned only if Bank of
America's future financial performance meets specific standards.
The overall structure of Mr. Moynihan's 2022 performance RSUs remains consistent
with the structure over the prior 10 years, during which time shareholders voted
to approve the Company's executive compensation program through the annual
advisory "Say on Pay" process with an average of 94.5% support. The performance
RSUs awarded to Mr. Moynihan continue to use a
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"re-earn" approach, vesting only if the Company meets specific performance
standards over a three-year period (from 2023 through 2025). Under this
"re-earn" approach, future performance of the Company below the standards of the
performance RSUs will decrease the amount ultimately paid; 100% is the maximum
payout if standards are met. The three-year average return on assets and
three-year average growth in adjusted tangible book value standards for the
performance RSUs are unchanged from last year.
Additionally, all of Mr. Moynihan's 2022 equity incentive awards are subject to
the Company's stock ownership and retention requirements. Specifically, 50% of
the net after-tax shares he receives from equity awards must be retained until
one year after his retirement. These equity awards also are subject to the
Company's cancellation and clawback policies.
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