8-KLeadership Changes

FIFTH THIRD BANCORP 8-K Report, Executive Changes (Dec 18, 2009)

Filed December 18, 2009For Securities:FITBFITBOFITBPFITB-PIFITB-PMFITB-PAFITBIFITB-PK

Summary

This Form 8-K filing from Fifth Third Bancorp (FITB) on December 18, 2009, reports on adjustments to the compensation of two senior executive officers, Daniel T. Poston and Greg D. Carmichael. These adjustments, effective January 4, 2010, were made to align their 2010 compensation with recently assumed additional job responsibilities and also relate to compliance with TARP compensation standards. The most notable changes include significant increases in base salary for both officers. Mr. Poston's base salary will rise from $699,575 to $950,000, and Mr. Carmichael's from $1,498,273 to $1,622,500. A substantial portion of these adjusted salaries will be paid in the form of phantom stock units, with the remainder in cash. These phantom stock units will be settled in cash in June 2011 or upon the executive's death, with the payout value tied to Fifth Third's common stock price at the time of settlement.

Key Highlights

  • 1Fifth Third Bancorp announced adjustments to the compensation of two senior executives, Daniel T. Poston and Greg D. Carmichael.
  • 2These compensation adjustments are effective January 4, 2010.
  • 3The adjustments aim to align executive pay with additional job responsibilities assumed by the officers.
  • 4The changes are also related to compliance with U.S. Treasury's TARP Standards for Compensation and Corporate Governance.
  • 5Daniel T. Poston's base salary will increase to $950,000, with a portion paid in cash and a portion in phantom stock units.
  • 6Greg D. Carmichael's base salary will increase to $1,622,500, also with a split between cash and phantom stock units.
  • 7Phantom stock units will be settled in cash on June 15, 2011, or upon the executive's death, based on the closing stock price at settlement.

Frequently Asked Questions

The salaries are being adjusted to reflect additional job responsibilities recently assumed by Daniel T. Poston and Greg D. Carmichael, and also to ensure compliance with the U.S. Treasury's TARP Standards for Compensation and Corporate Governance.

Phantom stock units are a form of incentive compensation that mimics the value of actual stock. They will be settled in cash upon the earlier of June 15, 2011, or the executive's death. The cash payout will be equal to the closing price of Fifth Third Bancorp's common stock on the settlement date.

The filing does not explicitly state that the salary adjustments are tied to improved company performance. Instead, it attributes the changes to 'additional job responsibilities' and 'compliance with TARP standards'.

No, the phantom stock units issued under the 2008 Incentive Compensation Plan will not include any rights to receive dividends or dividend equivalents.