WSFS Bank bucking tax-reform trend
Banks are still figuring out how to use the financial windfall coming from the passage of tax reform bill signed into law last month. Most have included enhanced compensation packages for employees, either through one-time bonuses or salary increases.
One notable exception is WSFS Financial Corp. (NASDAQ:WSFS), which took several actions including: writing down a deferred tax asset, the planned surrender of bank-owned life insurance (BOLI) policies, realizing a fraud loss charge, and a periodic grant to the WSFS Foundation. The combined effect of these actions will be a reduction of between $22.8 million and $23.8 million, or 71 cents to 74 cents per share, in after-tax fourth-quarter income, writes Jeff Blumenthal for Philadelphia Business Journal.
While many banks announced pay enhancements to employees, CEO Mark Turner said, WSFS didn’t feel as much of an urgency to follow suit. He said only about 5 percent of the company’s employees make less than $15 per hour, and virtually all of them are at $14 per hour. He said the bank will evaluate making an adjustment to be competitive with its rivals.
While many banks are offering one-time $1,000 bonuses to employees, Turner noted that Wilmington, Del.-based WSFS already has a bonus program that pays each employee $1,200 based on the bank’s strong performance. So it didn’t see the need to offer another bonus.
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