The kicker is buried in the VERY LAST paragraph ... he is responsible for a $279 million loss and walks away with lottery winnings .... I guess I should be getting a significant bonus this year for overdrawing on my checking account !
According to a regulatory filing, he is entitled to severance and benefits valued at about $14.1 million. He also agreed not to work for a competitor for 18 months, but may establish a hedge fund after six months or join an independent hedge fund after 12 months, the filing said.
Again this shows the lie in the reasoning for extremely large executive compensation ... i.e. Large compensation is justified because the execs have led the company to significant stock and shareholder gains .... but when they the lead the firm to losses the execs almost never take the same hit as shares (and stockholders) do .
January 3, 2008
State Street Takes Big Charge, Replaces A Top Exec
By REUTERS
Filed at 7:30 a.m. ET
NEW YORK (Reuters) - State Street Corp
William Hunt, who had led the State Street Global Advisors unit, resigned Wednesday after nearly three years in the job, the money manager said.
James Phalen, 57, head of international operations for investment servicing and investment research and trading, was named the unit's interim president and chief executive. He reports to Ronald Logue, State Street's chief executive.
The 71-cent-per-share charge addresses legal and other costs related to exposure to and illiquidity in subprime mortgages, State Street said.
It also addresses "customer concerns as to whether the execution of these strategies was consistent with the customers' investment intent," the company said.
State Street joins a growing list of financial services companies to record losses tied to deteriorating global credit markets.
The Boston-based company is the world's largest money manager for institutions, with about $2 trillion of assets under management as of September 30. It is also one of the world's largest providers of custody services for institutional investors, overseeing $15.1 trillion of assets.
State Street expects 2007 profit of $3.42 to $3.45 per share. Excluding the charge, merger costs, and tax adjustments, it expects operating profit of $4.54 to $4.57 per share.
Analysts on average expected profit of $4.20 per share, according to Reuters Estimates. It wasn't immediately clear on what basis this amount was calculated.
Hunt took over State Street Global Advisors at the end of January 2005, when he was 42. He joined the company in 1994.
According to a regulatory filing, he is entitled to severance and benefits valued at about $14.1 million. He also agreed not to work for a competitor for 18 months, but may establish a hedge fund after six months or join an independent hedge fund after 12 months, the filing said.
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