Morgan Stanley's Gorman Made $27 Million in 2017
20 January 2018 - 11:27AM
Dow Jones News
By Liz Hoffman
Morgan Stanley Chief Executive James Gorman made $27 million
last year, a 20% raise that sends a strong signal from the firm's
the board that it approves the progress he has made in reviving the
once struggling Wall Street firm.
Mr. Gorman's haul included a $1.5 million salary, a $1.2 million
stock award, a $5.6 million cash bonus and deferred cash and
long-term incentive pay -- whose value depends ultimately on how
Morgan Stanley performs -- of about $19 million, according to a
securities filing Friday afternoon and a person familiar with the
matter.
The raise makes Mr. Gorman, who runs the smallest of the big six
U.S. banks, one of the highest-paid CEOs on Wall Street. On
Thursday, JPMorgan Chase & Co., three times Morgan Stanley's
size, said it boosted Chief Executive James Dimon's pay to $29.5
million last year.
Morgan Stanley's vote of confidence in Mr. Gorman recognizes the
strides the firm has made since the executive took over in 2010. At
that time, Morgan Stanley had been humbled by the financial crisis
and was strategically adrift.
Mr. Gorman's decision to de-emphasize trading and embrace wealth
management -- a stabler, simpler and less risky business -- has
paid off, producing steady growth.
Morgan Stanley's 2017 revenue rose 10% from a year ago, and the
firm finally hit a goal of 9% return on equity. It beat other
stated targets, including profitability in its wealth-management
division, and brought a trading division once prone to blowups
under control.
"Mr. Gorman's compensation reflects the strong performance of
Morgan Stanley in 2017," a spokesman for the firm said.
Still, the size of his pay package -- and what it says about the
board's confidence in him -- is likely to raise eyebrows, given
Morgan Stanley's relatively smaller size and the fact that its
return on equity still lags peers.
One thing likely to keep Mr. Gorman focused on improvement: half
of his total pay, some $13 million, is based on the firm's
performance. That is up from about 30% in his 2016 compensation
package.
Write to Liz Hoffman at liz.hoffman@wsj.com
(END) Dow Jones Newswires
January 19, 2018 19:12 ET (00:12 GMT)
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