Charlotte.com: Banking
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• See what's under 'golden parachutes'
  When chief executives leave the corner office, how much will they take with them?Thanks to new Securities and Exchange Commission requirements, this year's proxy filings give a little clearer picture of top executives' potential severance payments, accelerated stock rewards, pensions and deferred compensation accounts.Known in some cases as "golden parachutes," these payouts gain attention when executives with questionable performance leave with flush pay packages. In recent months, CEOs at financial giants Citigroup Inc. and Merrill Lynch & Co. retired under fire but took huge sums with them.Among the nine Charlotte-area Fortune 500 companies, Bank of America Corp. CEO Ken Lewis is in line for the biggest potential exit package, according to data compiled by California-based compensation research firm Equilar Inc. If he were to lose his job after a change in control such as a merger, his total payout could reach $136.9 million.Many of his peers also would get big figures. (See chart).In 2003, Lewis gave up his employment contract and any guaranteed severance, saying his pay should be based solely on performance. He's still eligible, however, for other benefits.Under the change-in-control scenario, his stock options and awards -- worth $53.8 million at the end of 2006 -- would immediately vest, meaning the shares could be cashed in. Under a termination-without-cause scenario, $17.9 million of that total would continue to vest, subject to a noncompete clause.Lewis, CEO since 2001, also would get the payout under other scenarios such as retirement. If his employment is terminated voluntarily, the same portion of stock options and awards would continue to vest subject to the non-compete clause, according to the company's proxy. He would lose the stock if fired for cause.The value of executives' stock holdings, of course, fluctuate based on how their companies are doing. Bank of America shares are down about 21 percent this year amid tough times for financial institutions.During his nearly 40-year career, Lewis also has accumulated $49.2 million in pension benefits, plus $33.9 million in deferred compensation, a retirement account that includes salary he has set aside over time. Other CEOs, including Duke Energy Corp.'s Jim Rogers, also have racked up big deferred compensation accounts over long careers at their companies."Mr. Lewis earned his retirement benefits over a 39-year career at what is now the fifth most profitable company in the world under his leadership," bank spokesman Scott Silvestri said.In a study of this year's proxy filings, Equilar found that about 71 percent of CEOs at Fortune 200 companies were in line to receive severance such as cash payments, accelerated vesting of stock holdings and other benefits. The median potential payout was $21 million, typically not counting items such as pensions and deferred compensation.Change-in-control payments were even more prevalent, with about 82 percent of CEOs eligible. In these cases, the median potential payout was $28.6 million. This number also typically didn't include pensions or deferred compensation.Charles Peck, compensation expert with the Conference Board in New York, said the new disclosures highlight information that used to be buried in proxies, if available at all. In some cases, board members themselves weren't even aware of the total payouts awaiting CEOs, he said.Knowing more about exit packages is important, Peck said, because the argument for lucrative executive pay is that if it's performance-based it's OK."When they get huge severance payments when the company is struggling that argument breaks down," he said. "You can say it's pay for failure."CEO Exit PackagesHere are the total amounts Charlotte-area CEOs would receive under termination without cause and change-in-control scenarios.
  CEOCompanyTermination without causeTermination upon change in controlNoteKen LewisBank of America$119 million*$136.9 millionIncludes accelerated stock, pension and deferred compensation.Robert NiblockLowe's $2.2 million$37.2 millionReceives only deferred compensation in termination without cause.Ken ThompsonWachovia$35.2 million$35.2 millionMostly from accelerated stock options and awards. Gave up contract in 2005.Jim RogersDuke Energy$84.1 million$84.1 millionIncludes $62.1 million in deferred compensation accumulated during 17 years at Cinergy and predecessors.Dan DiMiccoNucor$6.3 million$6.3 millionIn change in control, executives eligible for non-compete payments and accelerated vesting.Bruton SmithSonic Automotive$396,396$14.7 millionChange-in-control payout largely from accelerated stock.Howard LevineFamily Dollar Stores$4 million$3.2 millionTotals include $468,883 in deferred compensation.Marshall LarsenGoodrich$14.7 million$48.7 millionIncludes deferred compensation and pension. Change- in-control includes $12 million for taxes.Chris KearneySPX $25 million$62.4 millionIncludes deferred compensation and pension. Change- in-control includes $15.3 million for taxes.
  Source: Equilar analysis of company proxies.Note: The totals include, where applicable, severance payments, accelerated stock awards and options, retirement plan credits, tax gross-ups, pensions and deferred compensation. Stock values change over time.*An additional $17.9 million would continue vesting.
• Citi shares recover; BofA, Wachovia down
  Citigroup Inc.'s stock recovered Friday, after ratings agencies alleviated some investor worries about the bank's decision to assume control of the seven "structured investment vehicles" it previously managed at arm's length.Other bank stocks, however, suffered. In afternoon trading, Wachovia Corp. shares were down 1.79 percent to $39.47; Bank of America Corp. shares fell 1.39 percent to $42.44.The world's biggest bank late Thursday said it will incorporate seven SIVs with $49 billion in assets onto the company's balance sheet.Citi shares initially fell about 3 percent in early trading Friday, after Moody's Investors Service, the credit-rating agency, slashed Citigroup's debt and financial strength ratings on Thursday, saying the bank's cash cushion is diminishing just as its profit weakens. Also, Sandler O'Neill & Partners analyst Jeff Harte downgraded Citigroup's stock to "Hold" from "Buy," saying helping these SIVs heightens the uncertainty the bank faces.But during a conference call Friday, Moody's clarified that the ratings cut was not because the bank brought the SIVs onto its balance sheet. Moody's credit analyst Sean Jones said he assumes that "Citigroup will not take any losses due to the quality of its assets."Meanwhile, Standard & Poor's said it does not expect Citigroup's plan to impair the bank's credit ratings.Citi shares rose 49 cents to $31.50 in afternoon trading.SIVs are investment funds created by banks like Citigroup and sold to investors. The funds borrow short-term money and invest it at a higher rate in mortgage, bank and credit card debt. The viability of a SIV hinges on its ability to continue borrowing short-term money.The value of many investments owned by SIVs has plunged this year amid decaying credit quality and a drainage of demand for risky debt.Vikram Pandit, who became Citigroup's chief executive on Tuesday, said taking control of the SIVs was the best way to protect their credit ratings and help them sell their investments at reasonable prices.Harte called the decision "a rapid about-face after drawing a line in the sand." Under Chuck Prince, Citigroup clearly stated it did not plan to bring the SIVs it sponsors onto its balance sheet.Harte said this move puts further pressure on the value of Citigroup's investments, and he wonders how fully the bank understands its exposure.Citigroup has already written about $6 billion off its books because of decaying credit quality, and warned it will need to write off as much as $11 billion more.CIBC World Markets analyst Meredith Whitney wrote in a client note the SIVs on Citigroup's balance sheet is likely to force Citigroup to raise more cash by selling $100 billion of its assets and cutting its dividend.
• LendingTree cuts work force a 3rd time within 8 months
  For the third time this year, Charlotte-based LendingTree has laid off employees at its three main U.S. locations.The online loan matchmaker and lender last week laid off 220 employees -- about 20 pe