NewsFlash: Bankers in authentic organization get ‘secret’ bonuses that they actually deserve!

by cv harquail on February 19, 2009

Among all the appropriate recriminations against (investment) bankers earning huge bonuses for running their financial institutions into the ground, it’s nice to hear about some bankers who might actually have earned their bonuses. As Martha Brannigan reports in the Miami Herald last weekend , bankers at The City National Bank of Florida received a total of $60 million in bonuses.

But how, in this economic climate, did these bankers actually deserve bonuses ranging from tens to hundreds of thousands of dollars?Miami banker

Consider how these bankers grew their institution.

The City National Bank of Florida grew from assets of 400 million to assets of $2.75 billion (over 24 years) expanding from 6 branches to 14. How did the bankers do it? They followed a reality-based strategy of "simplicity and basics". Explained Leonard Abess, chairman and chief executive of City National Bank of Florida,

"We stayed close to home and we made loans for the right reasons: for people’s businesses or to build something someone already decided they wanted to buy," Abess said. "We stayed with old-time clients and people they would bring us — they gave us referrals."

Next, consider who these bankers are.

They aren’t your typical Wall Street folks — these "bankers" include loan officers, bank tellers and custodians. Yes, custodians.

Consider what these bonuses demonstrate.

In handing out these bonus, bank CEO Leonard Abess demonstrated the values that defined the bank. "We value our employees."

Lots of bosses say they value their employees. Some even mean it.

And then there’s Leonard Abess Jr.

After selling a majority stake in Miami-based City National Bancshares last November, all he did was take $60 million of the proceeds — $60 million out of his own pocket — and hand it to his tellers, bookkeepers, clerks, everyone on the payroll. All 399 workers on the staff received bonuses, and he even tracked down 72 former employees so they could share in the windfall. (Click through for the whole story)

Consider, too, how these bonuses were distributed — in secret.

Abess actually gave out the bonuses to bank employees back in November, about 5 months after the sale. He wanted to keep the bonuses quiet, out of respect for the privacy of the bankers who received them. In fact, the the story of the bonuses was not publicly revealed until now, after Mr. Abess made an off-hand comment in a conversation with Miami Herald business writer Martha Brannigan.

If the story had come out back in November, when the bonuses were handed out, would the story have been picked up in newspapers across the country? Maybe not as the ‘feel good’ story it seems now. And, maybe it wouldn’t have been presented only from the angle of the "rich guy is generous". It might have been even more inspiring if,  instead of seeing Abess’s action as some kind of aberration of uber-generosity, we could have seen his action as a simple demonstration of authentic leadership.

Authentic leaders, and authentic organizations, match contribution with compensation, and responsibility with recognition. That kind of authentic behavior shouldn’t be kept secret!

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