Management Stock Grants: The Gift ThatKeeps On Giving

CHULA VISTA, Calif. - (06/21/05) -- When the board of First PacTrustBancorp voted last month to pay shareholders a second-quarterdividend of 13 cents a share, the directors of the bank, knownuntil January 2000 as Pacific Trust FCU, had a big financial stakein their own vote. The vote meant that the ex-credit union's sixdirectors voted to pay themselves $125,000 in dividends through thefirst half of 2005 and are on pace to reap as much as $250,000 individends this year, according to documents filed with theSecurities and Exchange Commission and reviewed by The Credit UnionJournal. The biggest beneficiary was Hans Ganz, the president andCEO, who engineered the conversion to bank. Ganz, who was grantedalmost $1 million in stock in 2003 and 2004, earned almost $35,000in dividends on his 123,000 shares in the first two quarters. Thatincludes more than 30,000 shares Ganz was granted under theex-credit union's recognition and retention program but has yet togain full ownership of. Under the stock grant program, topexecutives are given generous amounts of stock that they are vestedin over five years at 20% per year--but they are paid dividends onthe shares even before they are fully vested. Other directors whobenefitted from the first two quarter dividends are: Alvin Majors,chairman of the board ($17,000); Francis Burke ($16,000); KennethScholz ($16,000); Donald Purdy ($16,000), all of whom helpedconvert the credit union five years ago, and Donald Whitacre($14,000).