Magazine article American Banker

Plaza Executives Kiss Big Bonuses Goodbye

Magazine article American Banker

Plaza Executives Kiss Big Bonuses Goodbye

Article excerpt

THEY SAY ALL GOOD THINGS must come to an end. Brenda Lynn, vice president of loan production at Plaza Home Mortgage Corp., knows exactly what they mean.

During 1991 and 1992, Ms. Lynn was paid annual bonuses by a simple formula tied to volume.

Since she works for one of the fastest-growing mortgage banks in the country. the result has been astonishingly fat pay envelopes.

In 1991. Ms. Lynn received a base salary of $115,000 and a bonus of $743,886. But that amount was a pittance compared to her 1992 compensation. Loan origination volume broke all the records around the country last year, and Ms. Lynn's pay merrily followed suit. Her base salary rose to $150,000 and her bonus climbed to a mind-numbing $876,261.

William E. Moffatt head of secondary marketing, had compensation that mirrored Ms. Lynn's. In 1991 his salary was $96,000 and his bonus $540.000. Last year, while his salary remained unchanged, his bonus shot to a stratospheric $905,466.

Plaza's business took off when it went public a little over a year ago. Santa Ana, Calif.-based Plaza is now among the top 20 mortgage originators.

For the first six months of 1993, the company wrote $3.4 billion in loans and had a servicing portfolio of $3.4 billion in June. The company expects to originate between $8 billion and $10 billion in loans this year and expects to retain about 50% of those loans for its servicing portfolio.

But the bonus bacchanal, at least for Ms. …

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