Back in Business
Since retiring from Bank of America in April, Hugh McColl Jr. has projected the image of the retired CEO, taking a spring hunting trip to Texas and vacationing over the Labor Day holiday in Aspen, Colo. But don't get the idea he has left the business world entirely.
Mr. McColl, who turned 66 in June, is putting his decades of experience in mergers and acquisitions - and his name - to good use in a new Charlotte-based boutique investment bank called McColl Partners. Mr. McColl and a group of local investment bankers, whom he fondly refers to as "young people," will offer M&A advice to mid-sized companies.
Mr. McColl will help bring in new business as well advise on deals, he said in an interview this week. The firm likely will concentrate initially on the Southeast and Southwest, and Mr. McColl said he hopes it won't grow too fast. "We intend to not take on more than we could do," he said.
Meanwhile, Mr. McColl also is indulging his interest in art, forming a fine art consulting business with friend Massoud Shiraz. The two plan to advise clients on buying works of art.
With such a full schedule, Mr. McColl said he has not followed through on an earlier plan to work at M & M Partners, the hedge fund in which his son Hugh McColl 3d is a partner.
Sooner, Not Later?
Meanwhile, could another North Carolina bank chief be nearing retirement as well?
Bud Baker, 59-year-old chairman of the newly merged Wachovia Corp., offered more evidence this week that he may leave before his scheduled 2004 retirement date. Mr. Baker mentioned no date, but told Bloomberg News he plans to retire as soon as the company is running smoothly. "Nothing would please me more than for that to happen sooner than later," he said.
A Wachovia spokesman said Thursday there was nothing new in the statement. He said that Mr. Baker still intends to retire on schedule. "Mr. Baker's retirement date is set for the day of the 2004 annual shareholders' meeting. He has stated before that he expects to remain chairman through that date unless there becomes a more appropriate time based on the successful merger integration of First Union and Wachovia. He has every intention to stay," said the spokesman, Jay Reed.
And in an interview with American Banker Aug. 3, after Wachovia's shareholders approved the bank's merger with First Union Corp., Mr. Baker also hinted that he could decide to retire early. Although the combined company is based in Charlotte, and Mr. Baker will have an office there, he said that he had not yet made plans to move to Charlotte and planned to keep his Winston-Salem home.
Charles Schwab may be slashing its workforce by as much as 25% this year, but it's looking to do so with as little pain as possible - especially when it comes to layoffs.
On top of the usual severance packages, based on a tenure-and-salary formula, the San Francisco company is providing a special one-time stock option grant of 500 to 1,000 options to affected staffers, depending on their rank. Employees may immediately vest the options or wait a while; they have a 15-month window from the date they're granted to exercise them. If employees choose to exercise their options now they could buy Schwab's stock pretty cheaply. As of Thursday morning, it was off approximately 46% from its 52-week high of $35.50.
Also as part of the goodbye package - and in a somewhat unusual move - Chuck Schwab, chief executive officer of the company, and his wife Helen have followed through on earlier announced plans to set up $10 million educational assistance fund for laid-off employees. Each eligible staffer is entitled to a total stipend of $20,000 to pay for tuition at accredited schools. That program will be available for four years.
The company has also said that if and when things improve and Schwab finds itself again in a position to hire back any of the employees it will pay each rehire a signing bonus of $7,500, if they are hired back within 18 months of leaving the company.
Of course, delivering on that part of package will have to wait a while.
Schwab announced the somewhat unusual measures when it unveiled its first round of layoffs back in March, which aimed to trim the ranks by up to 13%. Last week, faced with steep declines in online trading by individuals, the company went farther, adding staff cuts that effectively would erase all of last year's hires.
By David Boraks and Niamh Ring