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Nobody expected bonus season to be comfortable, even with the financial crisis more than a year in the rear-view mirror. Yet, Goldman Sachs (GS) is getting sued over its compensation package, under which key executives are only compensated in long-term stock. In the latest development, John Mack, CEO of Morgan Stanley (MS), is skipping his bonus for the third year in a row, according to Reuters.
Mack isn't the first banking CEO to go sans bonus this year. Kenneth Lewis, top dog over at Bank of America (BAC) is getting neither a salary nor a bonus for 2009. Both plan to step down at the end of the year, though Mack will stick around Morgan Stanley as chairman. The last time Mack got a bonus was in 2006: he picked up $36.2 million in restricted shares.
Mack and Lewis aren't the norm on Wall Street this year. Bonuses are expected to surge 40%, according to Options Group, a recruiting firm. But, Mack is making his personal situation the norm at Morgan Stanley. His bank has put aside $10.87 billion for compensation and benefits for the first three quarters of 2009, down from $11.97 billion the year before, but still substantial -- especially when you factor in the staff reductions that occurred in between. At $175,000 per employee, it's only about a third of what Goldman has set aside.
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