As I thought about the ridiculous statements of Stil, Fan, etc. regarding BBT's performance, I couldn't help but think about the following:
In 2001, BBT issued its annual option package to employees with a strike price of $38. I know, I got them. Here we are in 2005, exactly 4 years since the issue, and they are worthless.
How can anyone in their right mind think this company is, 1) in good financial shape, and 2) has any other choice but to be BOUGHT.
Just for the sake of heading-off the inevitable comments back regarding, "I must not have been a performer," blah, blah, blah.
I think BBT was A VERY GOOD COMPANY. Anyone who believes differently during the years of 2000-2002 is wrong. However, what Stil and Fan don't realize is nearly 50% of the Bank's after-tax revenue is derived from new markets (i.e. FVB, etc.). To sit back in NC, and retired nonetheless, and think you know this company by looking at its financials, is absurd. Have you EVER been to DC/VA since the merger? Do you have ANY knowledge of who has left, how poorly the non-performers from FVB have been handled, have any idea about the vacancy rate at the branches, have any idea about the talent in those branches relative to other banks in the area? If you can't answer those questions, I would suggest you stick to what you know. BBT circa 1996 and BBQ.
When you two are done sending coded love letters to one another via this message board, you should get in your cars, drive up 95, and leverage your 40 year employment with the Bank and demand to verify what I've said.
I mean, how would they ever turn away two 40 year employees, BOTH of which were published in American Banker. You guys are great!
I don't disagree with having incentives for employees, but think they should be based on above average results.
My experience has been that salaries were to cover average employees and bonuses, stock options and other incentives were for above average performance.
Just because everyone seems to be doing it does make it correct or the right thing to do.
My point is if it is proper that the company employees and management get incentives whether stock options, bonuses or other things while the shareholders which are the true owners of the company do not share in the process? If bonuses, stock options or other incentives are broadly given then shouldn't the investors who put their cash at risk share in the rewards?
My point is that in the two year time frame being discussed originally management got theirs, but the shareholders did not. The only thing the shareholders have is shares of stock and the dividend and if the share price does not increase where is their return? In this case the share price decreased much more than the dividends paid, but options were still given.
DC: You must have gotten a different option package than I did in 2001. My option price was $36.59. With the stock closing above $39 today, I wouldn't call that worthless. And if you were really in a hurt for some funds a few months ago, you could have cash in when the price was around $43.
By the way, do you remember the year before. Options were granted at $23.9375. And in 2003, the price was $32.66. Now, tell me again how worthless your options have been the past several years? Do I wish our shares were trading higher. Absolutely. But, DC, get a hold of yourself. You're turning into another poster I know who supports his arguments with incorrect data and information without context.
You mentioned Fan and Stil. They could probably care less about your options anyway. Their bread and butter is the dividend, which incidentally, has a 10-year compound annual growth rate of 13.7% compared to 3.9% for the S&P 500. I'd say they're enjoying retirement and their BBQ just fine.
So while the shareholders value on a share of stock was losing value you were receiving options at the lower price.
You posted that 2001 options were at $36.59 and 2003 options were at $32.66. A shareholder during this time frame had shares that decreased in value of $3.93 a share over the two years.
The company's reward for the above performance to the shareholders (owners of the company) was to issure options at the $32.66 price to you. These options are to buy a share of stock at $32.66 and good for a ten year period.
That's real loyalty and working for the good of the shareholders (owners) of the company.
Not sure if this should be something that one would brag about or not. What did you do for the shareholders to deserve this windfall?