Countrywide execs to get large awards
Countrywide Financial Corp.’s 14 senior executives are expected to receive stock-based awards of $28.5 million upon completion of the Calabasas-based lender’s sale to Bank of America Corp., a May 21 regulatory filing showed.
Countrywide President David Sambol, who will run the combined companies’ mortgage business, would have awards valued at $12.4 million, based on Bank of America’s closing price on May 19, according to the filing. Chief Executive Officer Angelo Mozilo, who isn’t joining the bank, would have $7.7 million, the filing said. The 12 other senior executives would have awards totaling $8.4 million.
Countrywide, the biggest U.S. home lender and the second-largest Ventura County employer, agreed to be acquired by Bank of America after losing $703.5 million in 2007 and almost running out of cash. Some 2,200 Countrywide employees have lost their jobs since last year.
Mozilo and Sambol have drawn criticism about their compensation from investors as well as presidential candidates John McCain and Barack Obama because of the stock’s decline and the lender’s role in helping to create a record number of U.S. foreclosures.
Bank of America, the nation’s second-largest bank, expects to complete the purchase July 1 at terms unchanged from its announcement Jan. 11, according to the filing. While analysts including Paul Miller of Friedman Billings Ramsey Group have predicted Bank of America will reduce its offer because of the weakening U.S. housing market, the filing reflects no changes from when the transaction was announced in January.
The stock-based awards cited in the filing stem from Countrywide’s past awards to the executives and are separate from previously announced cash severance agreements that would pay the same executives a combined $81 million. Those severance payments hinge on a “qualifying termination of employment,” the filing said. Bank of America has signed retention agreements with Sambol and three other Countrywide executives, the filing said.