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Entries in Compensation (3)

Friday
Jul132012

JPMorgan Executive Pay ‘Clawbacks’ Revealed

Chris Hondros/Getty Images(NEW YORK) -- JPMorgan Chase has initiated compensation clawbacks related to its $5.8 billion trading loss, after announcing that some employees may have intentionally tried to hide the bad trades.

Ina Drew, who formerly led JPMorgan Chase’s chief investment office that was responsible for the bank’s trading loss, has agreed to forfeit two years worth of compensation, though her severance amount has not been reported yet.

JPMorgan Chase accepted that offer, the maximum clawback allowable under the firm’s employment policy, said company spokesman Joe Evangelisti, according to Bloomberg News.

Other managers in the London-based chief investment office left the company without severance and will have to forfeit up to two years of compensation.

Earlier on Friday, JPMorgan Chase reported second-quarter profit of $5 billion and that the losses on the CIO’s synthetic credit portfolio was $4.4 billion for the period.  The trading loss cut profits by nine percent for the quarter.

[CLICK HERE TO SEE JPMORGAN'S EARNINGS REPORT]

The bank’s shares rose six percent to $36 Friday after officials said the trading loss would be no more than $7.5 billion.

Copyright 2012 ABC News Radio

Friday
Apr202012

Will Citigroup Shareholders Sue over Executive Compensation?

Justin Sullivan/Getty Images(NEW YORK) -- Citigroup may get one step closer to a potential legal onslaught from shareholders if it proceeds with its compensation package, which was contested by investors in a rare failed "say-on-pay" vote this week.

Citigroup shareholders voted to reject the company's executive compensation plan during an annual stockholders meeting in Dallas on Tuesday after critics complained that top officials, including CEO Vikram Pandit, enjoy high pay that's not well-connected to increasing shareholder value.

The pay proposal received just 45 percent of votes cast and followed Citigroup's announcement on Monday that profits fell two percent to $2.9 billion from a year earlier, missing analysts' expectations.

Many "say-on-pay" lawsuits against companies do not survive the motion for summary judgment in court, said Brian Foley, pay consultant and managing director of Brian Foley & Co. in White Plains, N.Y.  Still, Foley said it is "highly likely" there will be one or more lawsuits against Citigroup if the company proceeds with its pay package.

"If Citigroup acts quickly and significantly maybe that reduces that likelihood or makes an impact.  It depends on what they do," Foley said.

Foley said one driving factor on whether the financial giant moves forward with its executive package is how Citigroup CEO Pandit responds.

"He was paid a very significant amount in 2011 in which they made award commitments to him.  Those don't come off the table unless he or they act," Foley said.  "If they act and he doesn't acquiesce, [the awards] are still his.  As a practical matter, it would have to be a joint action."

Pandit, 55, had $15 million in compensation for 2011, which included a base salary of $1.7 million, a cash bonus of $5.3 million, almost $4 million in deferred stock and another near $4 million in deferred cash.

Included in the compensation package detailed in Citigroup's 2012 annual proxy were multi-year retention award packages for the senior management team.  Pandit's "executive long-term performance retention award" could be worth $40 million, Bloomberg reported. 

Copyright 2012 ABC News Radio

Tuesday
Sep282010

Gender Pay Gap Report: Women Managers Still Lag Behind Men

Photo Courtesy -- Getty Images(NEW YORK) -- According to a new government report, females in management positions and their corresponding pay still lag behind that of their male counterparts.  The U.S.Government Accountability Office report, "Women in Management: Analysis of Female Managers' Representation, Characteristics, and Pay," released Tuesday, found little has changed for women in the workforce when it comes to compensation.  Congresswoman Carolyn Maloney, D-N.Y., and chair of the Joint Economic Committee, commissioned the report and is holding a congressional hearing Tuesday to discuss its findings.  "What is most startling to me is how little progress we've made even though there's a bright spot in that more women are gaining education, we're closing the education gap but we're not closing the pay gap," Maloney said. Although there are more women represented across several industries, the number of women managers only increased by one percent -- from 39 percent in 2000 to 40 percent in 2007.  The report analyzed 13 industries from construction to health care and looked at the pay gap between female and male managers. The factors used in determining the salary levels included age, hours worked and education.  For the first time, the report also looked at working mothers in management.

Copyright 2010 ABC News Radio








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