CHARLOTTE, N.C. - Despite noisy protests inside and outside Bank of America’s annual meeting here Wednesday, shareholders signed off on the $7 million 2011 pay package for the chief executive, Brian T. Moynihan.
The company said 92 percent of shareholders voted in favor of the proposal, a so-called say on pay resolution that gives stockholders the opportunity to give a nonbinding thumbs-up or thumbs-down on executive pay.
Last month, about 55 percent of Citigroup shareholders voted against that bank’s compensation plan for chief executive Vikram Pandit and other top officials there, and Wednesday’s vote was being closely watched for any sign that shareholder dissatisfaction was spreading to other financial giants.
Unlike in Citigroup’s case, however, shareholder advisory services did not recommend a “no’’ vote for Bank of America. And Moynihan’s pay, which did not include a cash bonus and was mostly in the form of stock, received less attention at the annual meeting than Bank of America’s continuing problems in the mortgage arena.
One shareholder after another, many of them representing activist groups, blasted Bank of America’s foreclosure practices, which have been the subject of multiple state and federal legal settlements.
The company, the nation’s second-biggest mortgage servicer, acquired a huge portfolio of subprime home loans when it bought Countrywide Financial in 2008. Along with tens of billions of dollars in losses, an avalanche of souring subprime loans and other mortgages in default overwhelmed the bank’s own internal systems, resulting in long delays and a barrage of criticism from frustrated borrowers.
“What is it going to take for Bank of America to start abiding by the law and treating customers fairly?’’ one shareholder asked Moynihan, who listened politely to the criticism of the company, which is based here. “Bank of America is among the worst.’’
“We follow the law every day,’’ Moynihan said, adding that Bank of America was busy “cleaning up’’ the mess left behind by Countrywide. “I think we’re doing everything we can.’’
Outside the downtown auditorium where the meeting was held, several hundred protesters gathered despite a heavy police presence and a phalanx of Bank of America employees checking attendees. Protesters have interrupted other presentations by Moynihan and shareholder meetings of other large banks recently, and the company was not taking any chances.
Moynihan said that Bank of America had just begun sending out 200,000 offers to borrowers to reduce their principal under the bank’s $25 billion settlement over foreclosure abuses with state and federal authorities earlier this year, and had already made $700 million in principal reductions.
As for his pay package, which consisted of $6 million in restricted stock and $950,000 in cash salary, Moynihan said, “My pay is aligned with shareholders.’’