Wells Fargo & Co. will probably withhold 2016 bonuses for senior leaders including Chief Executive Officer Tim Sloan after the bank’s business and stock were slammed by a bogus-account scandal, according to a person briefed on the talks.
The company’s board discussed the move in late January and is likely to make a decision by the end of this month, potentially eliminating annual incentive awards paid in cash or equity, the person said, asking not to be identified because the talks are confidential.
The measure, which also could affect finance chief John Shrewsberry and other top executives, is meant to hold management accountable but doesn’t reflect findings of specific wrongdoing.
Wells Fargo was last year’s second-worst performer in the KBW Bank Index tracking 24 of the largest U.S. lenders after the scandal rattled investors and customers. Annual net income slipped about 4 percent, the biggest drop since the financial crisis.
Sloan’s predecessor, John Stumpf, resigned in October after the bank was fined $185 million for opening legions of accounts for customers without permission. Politicians and labor groups said the company put undue pressure on workers to meet sales goals, then blamed them for misconduct without holding senior leaders accountable. Sloan and Shrewsberry haven’t been accused of wrongdoing.