Umpqua Holdings Corporation’s UMPQ Chief Executive Officer (CEO) Raymond P. Davis has been awarded a 35% hike in his compensation for 2014. Thanks to the completion of the landmark merger deal between Umpqua Holdings and Sterling Financial Corporation.
As per a proxy statement released by the company, Davis has earned compensation of $4.03 million in 2014, increasing from around $3 million in 2013. The total compensation for 2014 included a salary of $910,625, stock awards of $1.7 million, incentive compensation of $950,000 and an increase in pension value by $412,124.
The CEO’s pay package for 2014 was based on a number of factors – largely considering the expected benefits that the Portland, Oregon-based company is set to achieve from the Sterling Financial merger. The company’s pay decision considered post merger implications including substantial change in responsibilities for its executive officers, handling regulatory burden owing to the increased size and advancement toward realizing the benefits of the acquisition.
The West Coast witnessed the formation of the largest community bank with the closure of the Sterling Financial merger in Apr 2014. The merger led to over two fold increase in Umpqua Holdings’ assets, deposits and loans. As of Dec 31, 2014, market capitalization increased to $3.74 billion, from the pre-merger figure of $1.95 billion.
The proxy statement also revealed that the acquisition surpassed the 12% operating earnings per share accretion target. Further, the company is gradually making progress towards achievement of cost savings synergy target of $87million.
Davis’ pay hike seems to be justified given the pivotal role he played in laying down the company’s growth prospects with this befitting merger.
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