In case you had any doubts about the propriety of Merrill’s 2008 pay packages, this Wall Street Journal story on the continuing slugfest between Merrill’s former CEO John Thain and Bank of America’s chief Ken Lewis should put any doubts to rest: According to a securities filing last week, Merrill’s overall compensation and benefit expenses […]
Read more...Some readers have suggested that while ex-Merrill CEO John Thain’s actions post the agreement to buy his firm were questionable, his ouster was an effort to divert blame and attention for the turkey deal from BofA CEO Ken Lewis. If Thain, as Lewis charged, ducked direct questions about Merrill’s deteriorating financial condition, or worse, was […]
Read more...Our guest blogger Lune (who in one of his past lives worked on the Hill) was just in India and gives us his take on the Satyam Computers case, which has gotten scant coverage in the US. The Indian government’s reaction to its biggest corporate scandal ever makes for a useful object lesson. From Lune: […]
Read more...Playing fast and loose seems to be the theme of the evening. First we have the credulity-stretching China fourth quarter GDP release, and now we have the eleventh hour stealing of the silver by Merrill’s top executives as one of the firm’s final acts. Let us remember the fact set: Merrill managed to get Bank […]
Read more...We posted this in June: The Wall Street Journal reports today that Citigroup is shutting down Old Lane Partners, a hedge fund started by Vikram Pandit that the bank acquired a mere 11 months ago. The bank decided it couldn’t spare the capital to shore up the struggling hedge fund. The article noted: Old Lane […]
Read more...Rubin’s departure from Citigroup would seem to imply that his continued service there, amid the newly critical commentary on his failure to rein in the bank’s pursuit of risk, was no longer a plus. But the real question is: not a plus for him, or not a plus to the bank? Citi has also decided […]
Read more...Literature is rife with quotes and vignettes illustrating the gulf between the rich and everyone else. And those quips generally take class differences as a given. Far more interesting and corrosive are the anecdotes that seek to get the public to accept status differences when the basis for them is shaky indeed. One of my […]
Read more...Over a weekend, word leaked out that AIG is paying yet more retention bonuses. This move is making a complete and utter sham of the supposed punitive elements of the rescue. But clearly, there was not enough of an adverse reaction to the earlier announcements of retention bonuses to deter the giant insurer. A few […]
Read more...I had wondered whether former Lehman CEO was more than a tad unbalanced. Anyone who can tell a business peer, as he reportedly did to John Thain, that he would reach down the throat and tear out the heart of those who might be disparaging Lehman, at a minimum is wanting in propriety and decorum. […]
Read more...How can you give cash compensation to an executive, yet claim it is not a salary or bonus? You call it a “retention bonus,” No, I am not making this up. Note that AIG chose to make this disclosure the day before Thanksgiving, clearly choosing a time when it would attract the least notice. Not […]
Read more...Reap what you sow. Over the last 20 years, the ever-aggressive Wall Street culture has moved even further towards prizing, and paying for, individual performance. Even at the famously team oriented Goldman, after the trading side of the firm became the dominant profit engine, top executives would reportedly describe the investment banking side as “socialist” […]
Read more...The New York Times, writing from the industry town, in “Wall Street’s Pay Is Expected to Plummet,” tries to make the case that the calls for scalps deeper pay cuts are overdone: The first clues are emerging that Wall Street pay will plummet this year — but perhaps not enough to satisfy the financial industry’s […]
Read more...Another symptom of equity-market distress. And the New York Times also provides an interesting discussion of the behavioral implications of corporate officers borrowing against their holdings: When executives own big stakes in the companies they run, investors can rest a little more easily at night, knowing those managers have the shareholders’ best interests at heart. […]
Read more...New York State Attorney General Andrew Cuomo is out to compel AIG to recover bonuses paid to former executives. It’s an interesting ploy. Even if the New York AG were to prevail in establishing that the former officers were overpaid (the legal theory is that the company did not receive sufficient value for services paid), […]
Read more...The Wall Street Journal reports today that Citigroup is shutting down Old Lane Partners, a hedge fund started by Vikram Pandit that the bank acquired a mere 11 months ago. The bank decided it couldn’t spare the capital to shore up the struggling hedge fund. The article noted: Old Lane has essentially broken even since […]
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