Sallie Krawcheck Gets $6 Million Severance from BofA

October 08 00:00 2011

New York, October 8 ( – Pursuing his target to stabilize and strengthen Bank of America (NYSE:BA), Chief Executive Officer Brian Moynihan is reducing annual costs by $5 million and in the process he has ousted former wealth-management division head Sallie L. Krawcheck and Joseph Price, whose position was also eliminated. He is seeking to eliminate at least 30,000 jobs.

Krawcheck will receive $6 million that will include $850,000 which is her former salary for one year and a one-time payment of $5.15 million that will be given to her in 2012. Joseph Price will get a $5 million package.

Richard Lipstein, a managing director for headhunter Boyden Global Executive Search said that “This is yet another story about a corporate executive getting significant amounts of money after they’ve left their employer,” and added that “She was part of a restructuring that eliminated a layer of management; at her level, there are certain obligations that have to be fulfilled if you leave for non-cause.”

On their part, the ousted executives agreed to release Bank of America from claims, refrain from competing with the firm, and soliciting employees or luring away customers for one year. They will also receive health care benefits till the expiry of the agreement in 2012.

Krawcheck also stepped down from the Financial Industry Regulatory Authority’s board of governors.