Jefferies Grants CEO Handler $58 Million in 2012, Future Pay
Stock Chart for Jefferies Group LLC (JEF)
Jefferies Group Inc. (JEF), the investment bank that agreed to sell itself to Leucadia National Corp. (LUK), paid Chief Executive Officer Richard Handler $19 million for fiscal 2012 and approved $39 million in restricted stock awards for the next three years.
Jefferies boosted Handler’s annual pay 36 percent for the year ending Nov. 30, with a package that includes a $5 million cash bonus, $13 million in stock and a $1 million salary, according to a regulatory filing by the New York-based firm today. The three-year plan is similar to an incentive program enacted in 2010, maintaining annual payouts of restricted stock units at about $13 million through 2015, the filing shows.
The compensation packages -- worth $58 million combined -- follow a 48 percent jump in the company’s stock during the 12 months ended Nov. 30 as net income remained little changed at $282 million. Leucadia, Jefferies’s biggest shareholder, agreed in November to a $2.8 billion takeover that will make Handler CEO of the combined firm.
The compensation committee decided to pay Handler, 51, a bonus of $8.1 million for 2012. He volunteered for that figure to be cut by $3.1 million, according to the filing. The bonus is subject to a 100 percent forfeiture for one year.
Handler’s annual pay compares with a $21 million package awarded to Goldman Sachs Group Inc. (GS) CEO Lloyd Blankfein for 2012. Blankfein got $13.3 million in restricted stock that comprises about 70 percent of his total bonus, a person with knowledge of the matter said this month. On that basis, the total bonus is about $19 million, including $5.7 million in cash. Blankfein, 58, also receives a $2 million salary.
The JPMorgan Chase & Co. (JPM) board of directors cut CEO Jamie Dimon’s pay for 2012 to $11.5 million, according to a Jan. 16 report that gives him the “ultimate responsibility” for the bank’s biggest ever trading loss.
Brian Friedman, 57, chairman of Jefferies’s executive committee who is set to become president of the combined company, received a $14.3 million pay package for 2012. That consisted of a $750,000 base salary, a $3.75 million cash bonus and $9.75 million in long-term equity incentives.
Jefferies told employees in December it would pay year-end bonuses in immediately available cash in an attempt to distinguish itself from its larger bank-holding company rivals. The firm said it will maintain clawback policies on year-end compensation if an employee leaves for a competitor, which was a provision established in 2011.
For 2011 pay, Jefferies gave its employees the option of taking their bonuses in stock or in cash at a 25 percent discount. Handler and other executives declined fiscal 2011 bonuses after a year in which the firm faced investor scrutiny about its holdings in European debt.
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