Despite financial woes, Wells Fargo gives CEO $6 million raise

Wells Fargo's board of directors gave CEO Tim Sloan a US$4.6 million ($6.2m) raise. Photo / AP

Wells Fargo's board of directors gave CEO Tim Sloan a US$4.6 million ($6.2m) raise last year, despite the bank continuing to face the fallout of its sales-practices scandal and a multitude of other issues.

In its annual proxy to shareholders, Wells Fargo said Wednesday that Sloan made US$17.6m last year, up from US$13m in 2016. While Sloan did not get a cash bonus in 2017, the value of the Wells Fargo stock awarded him rose to US$15m from US$10.5m. His base salary also rose marginally.

Sloan's salary increase was about 35 per cent, roughly equal to the pay increase that Bank of America CEO Brian Moynihan received. JPMorgan Chase has not filed its proxy statement for this year yet. Its CEO, Jamie Dimon, received a pay package of US$28m in 2016.

San Francisco-based Wells Fargo is facing several investigations into its business, most notably its opening of millions of fake accounts without getting customers' authorisation.

The Federal Reserve put unprecedented controls on Wells Fargo's business earlier this year, forcing the bank to replace four of its directors and capping its growth until the bank develops better risk-management practices.

Along with the sales-practices issue, Wells Fargo is under investigation for forcing auto insurance policies onto roughly 800,000 auto loan customers who may have already had insurance elsewhere.

In several thousand of cases, the additional cost of the insurance made the car loan payment unaffordable and those vehicles were eventually repossessed.

And last year Wells Fargo had to offer refunds to customers after acknowledging that its mortgage bankers unfairly charged them fees to lock in interest rates on mortgages. The bank is also under investigation for possibly overcharging corporate customers foreign transaction fees.

John Shrewsberry, the bank's chief financial officer, saw his total compensation increase to US$11.9m in 2017 from US$9.3m in 2016.

- AP