No 2009 Salary Or Bonus For Ken Lewis, $1 Million To Be Clawed Back, Says Pay Czar
Ken Lewis' problems continue. The WSJ reports that the outgoing BofA/ML CEO was just docked his entire 2009 pay and then some:
Kenneth Lewis, outgoing chief executive of Bank of America Corp.,
will get no salary or bonus for 2009, according to people familiar with
the matter, the biggest Wall Street name thus far to come under the
thumb of the government's pay czar.
In fact, Mr. Lewis will have to repay the North Carolina-based bank more than $1 million in salary he has already earned.
The move was demanded by Kenneth Feinberg, the U.S. Treasury
Department's special master for compensation, and was agreed to by Mr.
Lewis and the bank. Mr. Feinberg's rationale is based largely on the
fact that Mr. Lewis will leave the firm with a package of retirement
benefits and other stock awards worth between $69.3 million and $120
million, these people said.
Look for every bank still on the taxpayer dime to look to repay TARP tomorrow.
The move will stun Wall Street, which has been anxiously awaiting
Mr. Feinberg's rulings on compensation at seven firms receiving large
sums of government aid, including also Citigroup Inc. and General
Motors. Mr. Feinberg had been expected to clamp down on compensation by
cutting salaries for the most highly-paid employees at these firms. But
until now there's been little indication he would take away an
employee's entire pay.
For Mr. Lewis, the move bookends the rapid fall of an executive once
heralded as one of America's top bankers. Less than a year ago, he was
hailed for helping avert financial disaster by snapping up teetering
mortgage giant Countrywide and rescuing investment bank Merrill Lynch.
Mr. Lewis's fortunes soon turned as he was forced into the government's
arms to help his bank digest Merrill Lynch and eventually stripped of
his chairman title by angry bank shareholders.
While you may think Lewis' the retirement benefit package may be enough to last him until his quiet end somewhere far from the company he nearly destroyed in his over-zealousness to acquire Merrill, and remembered as one of Wall Street's worst CEO's, don't forget - he still has a very rough civil (and potentially criminal) trial coming up. Those can be quite costly, and also, in jail you can only smuggle so much cash (in your various bodily orifices).