Bloomberg – Morgan Stanley gave Chief Executive Officer John Mack the biggest bonus for the head of a Wall Street firm, awarding him $40 million as the company headed for the best profit in its71-year history.
Mack, 62, was granted shares valued at $36.2 million as of Dec. 12, and about $4 million in options to buy Morgan Stanley shares, the company said yesterday in a filing with the U.S. Securities and Exchange Commission. The firm also granted more than $57 million in bonuses for seven other top executives.
The payout for Mack, 44 percent more than Morgan Stanley awarded him last year, eclipses the $38.3 million in total compensation Henry Paulson received in 2005 as CEO of Goldman Sachs Group Inc. Shares of Morgan Stanley, the second-biggest U.S. securities firm by market value, are having their best year since 2003 after Mack put the firm on course for record earnings.
“You expect performance to be reflected in the compensation,” said Laura Thatcher, an Atlanta-based partner in charge of the executive-compensation practice at law firm Alston & Bird LLP. “You’re talking about staggeringly big companies with huge market caps and huge performance.”
Shares of Morgan Stanley have gained 40 percent this year, outpacing the 16 percent advance by the Dow Jones Industrial Average. The stock closed yesterday at $79.60, giving the company a market value of $84.2 billion. The firm may report next week that full-year profit rose 41 percent to $6.98 billion, the average estimate in a Bloomberg survey of 10 analysts.
