If NationsBank Corp.'s buyout of Boatmen's Bancshares is any indication, industry consolidation is lining the pockets of banking's top executives.
In acquiring St. Louis-based Boatmen's, NationsBank of Charlotte, N.C., is giving generous compensation packages to Boatmen's chairman and CEO Andrew B. Craig 3d, vice chairman Gregory L. Curl, and president Samuel B. Hayes 3d.
The lucrative pay deals are to come before shareholders Friday when they vote on the acquisition plan.
The 65-year-old Mr. Craig, who is to be named NationsBank's chairman, will be paid at least $3 million a year in addition to getting about 100,000 shares of restricted stock.
The compensation package will more than double his $1.2 million salary and bonus at Boatmen's and will make him one of the industry's highest-paid executives, though he will not be running the combined banking operation.
That task will be left to NationsBank's current chairman, Hugh McColl Jr., who will retain his title of chief executive officer after the merger closes in January. Mr. McColl made about $3.5 million in combined salary and bonus in 1995.
Mr. Curl and Mr. Hayes also are being paid well for sticking around. Each will get cash compensation of at least $900,000 as well as 50,000 shares of restricted stock. Mr. Curl gets the title of vice chairman of NationsBank corporate development; Mr. Hayes will oversee NationsBank's western operations.
At least one industry observer said he believes the pay packages are part of a trend toward rewarding key banking executives with hefty salary, bonus, and stock compensation, reflecting the premium placed on retaining top talent.
"As NationsBank has gotten larger, their compensation more reflects that of a money-center bank, not a regional bank," said John Platte, managing director of the regional banking practice at Russell Reynolds Associates Inc., an executive recruiting firm based in New York. "Now those guys are in the leagues of the money-center banks."
Russell Reynolds recently completed a compensation study that found significant competition for top talent. Top banking companies increasingly are boosting compensation levels and coming up with aggressive pay packages for star performers, the study said.
NationsBank announced its deal with Boatmen's in August. The combination will create a $230 billion-asset, 16-state franchise with 13 million customers in the Southeast, Midwest, Southwest, and Middle Atlantic regions.