U.S. Bancorp (NYSE: USB) took a cue from Wells Fargo (NYSE: WFC) in the compensation arena, giving its President and CEO Richard Davis a retention bonus in stock that vests over three years. However, a condition that certain performance goals are met over that time is included.
The incentive plan is the latest effort by a bank to tie performance with compensation following public outcry over banking bonuses following taxpayer bailouts.
According to the plan, Davis will begin being vested in stock over three years. If shares of U.S. Bancorp are trading at its current price during 2013 and 2015, Davis would receive roughly $7 billion in stock based compensation, according to regulatory filings.
U.S. Bancorp’s plan also includes thirteen executives that report directly to Davis, they would all receive smaller stock payments that range from $176,000 to $4 million. According to the filings, half of the compensation will come in restricted stocks, while the other half will be stock options.
U.S. Bancorp reported earnings of $580 million or 30 cents a share for its most recent quarter, ended Dec. 31. The bank is one of few that remained profitable in recent years. U.S. Bancorp also paid back $6.6 billion in TARP funds in mid-2009.
