TSFG board takes pay cut

Discussion: Comments

Two more directors step down

The board of directors of The South Financial Group have cut their own compensation for 2010 and announced resignations of two more directors.

The board said in a statement to the Securities and Exchange Commission dated Feb. 11 that the compensation cut "represents a reduction of approximately 50 percent" and that the action was taken "in recognition of the current environment and management compensation levels."

In 2008, the last year for which director compensation is available publicly, TSFG paid its directors $1.7 million. At TSFG's annual meeting in May, the directors promised shareholders that director compensation for 2009 would be reduced 20-25 percent effective July 1.

TSFG, the Greenville holding company for Carolina First and Mercantile Bank of Florida, has lost money for two full years, and executives have said the losses likely will continue through 2010, albeit at a lower level.  The stock is languishing below 50 cents on NASDAQ. Two years ago, TSFG traded in the mid teens.

The board said the annual retainer for board members was cut from $45,000 to $32,500 and the fee for attending a meeting was reduced from $1,000 to $750 for up to 12 meetings a year.

Additional compensation for the chairman, committee chairmen and committee membership also was reduced.

John C.B. Smith's annual additional stipend for being chairman was reduced from $50,000 to $20,000. The additional compensation for the audit and compensation committee chairs was cut in half to $12,500 and $10,000 respectively, and the risk committee chairman was reduced to $10,000 from $15,000.

Compensation for serving on committees was reduced by half to $5,000.

At the same time, the company announced board resignations of Donald T. Heroman, the retired chief financial officer of Equifax of Atlanta, and William P. Brant, a Jacksonville, Fla, attorney.

Heroman was appointed to the board just six months ago.  Brant first joined the board in 2001. The company said their resignations were not the result "of any disagreement" and that the board appreciated their "valuable contributions."

Darla D. Moore, for whom the business school at the University of South Carolina is named, resigned effective Jan. 1.

No replacements have been made.

In announcing the latest resignations, the board said it is reviewing the size and composition of the board "with the expectation that over the next several months, board size may be further reduced.  However, this would not preclude adding new directors with specific skills appropriate for the current environment."

With the departures of Moore, Heroman and Brant, the board numbers 11. This includes H. Lynn Harton, president and chief executive officer, who does not receive additional compensation for serving on the board.