DEL.ICIO.USMany Georgia banks say no executive bonuses
In past, some end-of-year payouts have been in six-figure range
The Atlanta Journal-Constitution
Monday, December 22, 2008
It’s a bleak holiday season for Georgia bankers.
Profits are down, bad loans are mounting and the economy is tanking. Bah, humbug, indeed.
Gordon Teel, CEO of Atlanta-based Georgian Bank: ‘In this environment, we all ought to be grateful to have a job.’
And that means no bonuses for many of the state’s bank executives, a marked change from recent years, when soaring profits sometimes meant six-figure salary sweeteners at year’s end.
Gordon Teel, chairman and CEO of Atlanta-based Georgian Bank, said for the first time in memory, his bank doesn’t plan to offer bonuses.
“In this environment, we all ought to be grateful to have a job,” he said.
Palmer Proctor, president of Atlanta’s Fidelity Bank, had a similar take.
“We’re not doing anything. No bonus,” he said. “In my mind, it’s just not appropriate given the level of earnings the bank is generating at this point.”
Fidelity lost nearly $3 million through the third quarter, compared to earnings of $7.6 million in the same period last year.
Bank bonuses are under renewed scrutiny these days, as the federal government pumps hundreds of billions of dollars into banks nationwide to stabilize the reeling industry.
Many critics, from Capitol Hill to Main Street, say bonuses shouldn’t be handed out in such a climate.
Only a handful of Georgia banks have announced they’ve received government cash, though many have applied.
Georgia’s largest bank, SunTrust, has received $3.5 billion and has asked to sell an additional $1.4 billion in preferred shares to the U.S. Treasury Department. The bank says it hasn’t decided what course to take regarding bonuses. The company’s board will consider the matter after the year is over, spokesman Barry Koling said.
For the second year in a row, United Community Bank in Blairsville won’t be handing out bonuses to its senior management team, said Jimmy Tallent, the bank’s president and chief executive officer.
The bank has received a $180 million federal cash infusion, but Tallent said the company’s performance does not warrant any payouts. United Community lost $14.5 million through the first three quarters of the year, posting its first quarterly loss in its 58-year history.
In 2006, though, Tallent and his leadership team were paid handsomely. Tallent received a $650,000 bonus, in addition to a base salary of $472,500, according to a company filing.
Four other executives received bonuses of between $145,000 and $300,000 that year.
Not all banks are cutting back. Atlanta-based Atlantic Capital Bank will be paying bonuses based on this year’s performance, though not to executive officers. As a new, or de novo, bank, it’s prohibited from granting such payments to its top officials, said Doug Williams, the company’s president.
The 19-month-old bank’s loan portfolio has grown fast this year, from $91 million at the end of 2007 to more than $400 million, Williams said, a robust performance that warrants a financial reward.
“We’re a bright spot in an otherwise dismal picture,” Williams said, noting that as a new bank, the company isn’t saddled with bad loans like so many Georgia banks. He expects to have problems at some point, given the challenging economic environment.
Steve Bridges, president and CEO of the Community Bankers Association of Georgia, said the recent downturn comes after a robust 10- to 15-year period in which bonuses were common.
“It’s a little bit of a wake-up call to these folks that a bonus isn’t something they should be counting on as something in their pocket,” he said.
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Comments
By Banker Individual
Dec 24, 2008 9:26 AM | Link to this
To Debra: Who's the moron? My company is doing well in spite of the bad economy. It is managed well. But, even if I lost my job, I would not expect someone else to fix my credit. I'm sorry your company shut down and I do not wish that on anyone. However, it is your job to work to clear your credit or get out of whatever fix you are in. It is not my or anyone else' responsbility. Go back to school, learn a new skill, get trained to do something else, move somewhere that has jobs but do it yourself. Don't ask the government or anyone else to do it for you or you.
By Wyld Byll Hyltnyr
Dec 23, 2008 1:37 PM | Link to this
Bank executive bonuses are among the most, if not the most, sacrosanct of American traditions. Bankers should be paid their bonuses.
By Debra
Dec 23, 2008 12:58 PM | Link to this
To Banker Individual - you moron, people have lost their jobs due to chut downs. I took care of my bills, on time every month. Here's hoping your azz loses your job and then e-mail me.
By SuLu
Dec 23, 2008 12:16 PM | Link to this
BTW, Ga is home to a couple of jet industries so don't be too hard on them. If the car guys gave up jets may I suggest Congress do likewise (including corporate lobbyist loans of same) But why favor use of cars over jets???
Bankers are so cute! Mine offered ma a real deal I'm sure because I was a valued customer: One week before AIG went belly-up he offered me an AIG CD at twice the interest earnings of his bank's FDIC insured CD. When I asked about the lack of FDIC protection he assured me even though it wasn't in the strictest sense, every financial product in the end was backed by the US govt. Could have said yes but said no. Turns out the crook was right. Same Dude who led me to believe each ACCT is guaranteed up to 100K by FDIC. Didn't quite turn out to be true!
By Dennis
Dec 23, 2008 11:53 AM | Link to this
Its a disgrace that United Community got a dime of this bailout money. As one of those who had more than $150,000 embezzled by their head bookkeeper I am outraged. Not only is she still employed but I never saw a dime of it back.
The UCB money never went to loans. Tallent even boasts that they didn't really need it but it was too easy to get. Instead of bonuses, the bailout money found its way straight into the pockets of a few directors and I'd bet my shirt that Tallent found a way to keep a million or so for himself.
By terr
Dec 23, 2008 10:41 AM | Link to this
Anyone who has a job has expectations of performance. When the average worker meets those expectations he/she is graded as "met" and not rewarded as if they had exceeded or greatly overachieved what was expected by their employer. The CEOs and executive management staff set the expectations for themselves and the rest of the organization. However, when they meet, or even fail to meet expectations, their rewards are exorbitant and unimaginably greedy. Everyone who is employed is lucky to have a job. Making the excuse that the CEOs and executive staffs are somehow different and more skilled and talented than the rest of us so that they deserve such ironclad employment contracts, stratospheric salaries, perks, and bonuses, no longer blinds us. These men and women leveraged themselves as they rose in position and networked so that there is a subset of employees who move among these golden positions. It no longer matters that they do not achieve what they were hired to do. They have somehow disseminated the myth that they will not work unless overcompensated. We don't buy it but the boards of directors among whom they move believe it. Or do they? These corporate titans HAVE to be paid what they demand. And if their companies do poorly or fail, too bad. The easiest way to improve a company's bottom line is to let employees and their pesky salaries and sometimes benefits go. While it would make a bigger dent to let those go making millions and the hundreds of thousands go, in truth most of those "Laid Off" make under $100,000/year. In many cases the people heading our companies have amassed fortunes and will survive nicely without that next corporate windfall. But what about the rest of us who are losing our homes, face no possibility of retirement ever, can't eke out even a little to save for that rainy day that has arrived with a deluge, pay for a child's college or wedding? We keep hearing it is our fault, we overspent, didn't save, etc. Some of us did those things. But many of us have always just tried to get by and have a decent life. We're not bums for getting laid off and not finding any job, let alone a comparable position. Those bankers who came, hat in hand, to the government demanding and threatening for a handout, just as the heads of our auto industry are doing, refuse to account for what they are doing with our money (and it is our money) and have no scruples about saying such information isn't for public information. They aren't in danger of losing that $230,000 family home or not being able to take a sick child to the doctor or losing insurance when the insurance company decides it is a great idea to determine coverage or premiums based on credit scores instead of payment history. There are remedies. There are people we honor with election to public office who can do the right thing and make the hard choices. Starting with our local reps. We have what it takes and we can start over, fixing what needs fixing, changing what needs changing, and working for reasonable compensation. The 80's and their mantra of "Greed is Good" is long over. Each of us has individual and collective responsibilities and it's way past the hour of turning to.
By Banker individual
Dec 23, 2008 10:35 AM | Link to this
to Debra: fix your own credit. It is nobody's responsibility but your own. It is called personal responsibility. No one held you at gunpoint to take out that credit card or by that home you could not afford. Those of you who voted for Obama want a government babysitter, not a president. The US icon is no longer "uncle sam" but "daddy obama". Try making your own way and don't wait for the government to pay your mortgage, utilities or fix your credit.
By Proud American
Dec 23, 2008 10:35 AM | Link to this
Everyone wants to blame someone for the mess the economy is in, people losing jobs,banks and auto makers getting bailouts. Obviously the Democrats want to blame the Bush administration, but theres the Democrats are far from innocent, who pressured the banks to lend money to people who could not repay there loans and by the way. Why did YOU buy that huge house you could not afford ? So you took out that stupid ARM, OR MAYBE YOU REALLY TOOK THE BAIT and took out that INTEREST ONLY loan, ( what a real genius didn't you know that the principal still would come due ) ? Perhaps to celebrate that house you could not afford you took everyone out to a ball game and helped pay over priced athletes play a game whom your kids idolized even as the news reported they were doing drugs , beating there wife or even worse. Or perhaps you just took every out to see the latest movies again overly paid actors ( PREDOMINATELY DEMOCRATS ) oh by the way how many were in the news in the last 12 months, drugs, alcohol, audultery, murder).
Our president elect wants us to share our wealth, well I come by my money honestly , I work darn hard for it. I don,t mind giving to charities or helping some one in need but I want it to be my choice. I do not spend my money to help pay someone MILLIONS of dollars to play games I enjoyed paying to play myself, or some Actor MILLIONS of dollars in some film, who in turn uses there celebrity for political use.
People are being laid off work or not getting merit increases or performance bonuses but our Democratic congress voted there selves a pay raise. We all should be thinking term limits.
So where does the blame belong? OURSELVES.
By Banker individual
Dec 23, 2008 10:30 AM | Link to this
I really love how people lump every group of people together even without separating the good from the bad. There are bad bankers and there are good bankers just as in every other job segment. Please do some research on how much money banks give to charitable causes each year and how active they are in the community. Not all banks are getting the bail out money and not all banks do these mortgages that caused so many foreclosures. All bank executives answer to some type of board of directors who invested their money in a bank. If the board and shareholders choose to pay someone a salary that is their business. All the socialists/communists of this blog are bashing bankers when it sounds a little like wealth envy. The reality of banking is that deals are made on the golf course, at charitable functions, and at a lunch or dinner table.
I want all of you banker bashers to try to get a loan from either a bank owned by poor people or one that is run by the non officer employees. It will not happen. If you don't like bankers, keep your money in your mattress. Take some responsibility for your own actions and don't force your beliefs on someone else. Grow up! I work on average 40 hour weeks but as an officer of the bank I am freqently at events at night and on weekends to promote the bank. The notion of banker's hours is old and outdated. We work hard just like landscapers, cashiers, and waitresses.
By CookieMom
Dec 23, 2008 9:38 AM | Link to this
Not all of these banks are your corporate banks making millions of dollars a year. Most of the ones failing are your hometown banks that loaned money to hardworking people who now are unemployed. That's why banks are failing right now. Houses are not being built, jobs are being lost and people can't pay. My husband's bank gave up their company Christmas party and executive bonuses (which are not $200 million) this year and had a Christmas breakfast instead.
BankersRcrooks, your uninformed comments are ridiculous. I'm sure you keep your money under a mattress and have never asked from a handout from anyone. Don't stereotype all banks when you know nothing about what goes on inside. Stop blaming and be a part of the solution. Understand that we're in hard times right now and we all must work to get out.
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