Wells Fargo's Sloan received a 35% pay bump in 2017
Wells Fargo CEO Tim Sloan was paid $17.4 million in 2017, up 35% from the previous year, in spite of the bank’s struggles to move beyond its phony-accounts scandal.
Sloan received a $2.4 million salary and stock awards worth $15 million, the bank said Wednesday in a regulatory filing. For the second consecutive year, he did not get a cash bonus.
Sloan took over as Wells Fargo's CEO in October of 2016. He had previously served as president and chief operating officer.
In Wednesday's filing, Wells Fargo stated that Sloan recommended that he not receive a cash bonus in 2017 based on his “ultimate responsibility” for the company’s performance, including “significant but incomplete progress on addressing compliance and operational risk-management issues.”
The San Francisco bank’s board of directors agreed with that assessment, though it also called the firm’s financial performance “solid” and lauded Sloan for what it called his “continued leadership on the company’s top priority of rebuilding trust and building a better bank.”
Other top executives at Wells did receive cash bonuses in 2017 after being denied them the year before. Chief Financial Officer John Shrewsberry received a bonus of $950,000, part of an $11.4 million compensation package.
Avid Modjtabai, a senior executive vice president at the bank, received total compensation of $10.6 million, including an $831,000 cash bonus. David Carroll, who retired last summer as head of the bank’s wealth management unit, received $9.7 million in total compensation, including a $485,000 cash bonus.
In all, the four highest-paid executives at Wells Fargo received total compensation of $49 million in 2017, up 22% from the previous year.
Following the revelation that Wells employees opened as many as 3.5 million unauthorized customer accounts, the bank's efforts to right the ship have been hindered by new disclosures of misconduct involving mortgages, auto loans and investment products. In February, the Federal Reserve Board took the unprecedented step of capping the bank's asset size until it is assured that proper controls are in place.
Still, Wells Fargo recorded net income of $22.2 billion last year, and it has undertaken various cost-cutting initiatives aimed at bolstering its bottom line.
"We had solid financial performance in 2017 as we continued to execute on our plan of building a better bank for the future and to make progress on our efficiency initiatives," the bank said in its regulatory filing.
Wells also disclosed that the median annual compensation for its 263,000 employees other than the CEO was $60,446 in 2017. The bank estimated that Sloan’s total compensation was 291 times higher than the median of the annual total compensation of all employees.
For the first time this year, many U.S. banks and other public companies are required to disclose the ratio between what their CEO was paid and what their median worker received.
Wells Fargo’s pay ratio is toward the high end of U.S. banks that have reported so far, according to a report Wednesday by Autonomous Research. Among some 30 banks that have made the disclosure, median CEO pay was 140 times higher than that of worker pay, the report found.