- Wall Street Reacts With Skepticism, Anger on Moves to Cut Pay
- Pay Master Navigated Some Conflicting Demands
- Fed Hits Banks With Sweeping Pay Limits
- Citigroup Taxpayer Ownership Doesn’t Prevent Lobbying
- CIT and Goldman Strike a Deal on Debt
- Apollo Pulls Off a Turnaround With Funds
- After a Decade-Plus Together, Calpers Reviews Apollo Ties
- Top execs at rescued auto firms to get 25% pay cut
- GM Said to Boost CEO Henderson’s Compensation to $5.45 Million
- Nokia sues Apple to regain market share
- Amazon.com Set to Break Dot-Com Record as Profit Tops Estimates
- Fortune Magazine Cuts Back Number of Issues
Wall Street Reacts With Skepticism, Anger on Moves to Cut Pay – Bloomberg
The Obama administration’s moves to rein in executive pay sparked criticism on Wall Street, as lenders such as Bank of America Corp. said the measures may hurt the very companies the U.S. is intent on saving.
“People want to work here but they want to be paid fairly,” said Scott Silvestri, a spokesman for Bank of America, the recipient of $45 billion of bailout funds. Rivals are “identifying our top performers and using pay concerns to recruit them away for fair-market compensation,” he said…..
Fed Hits Banks With Sweeping Pay Limits – Wall Street Journal
In a one-two punch at the pay culture of banks and Wall Street firms blamed for the financial crisis, the U.S. government announced plans to aggressively regulate compensation at thousands of lenders and impose steep pay cuts at seven companies that received billions in federal aid.
While the moves had been anticipated for weeks, Thursday’s separate announcements by the Federal Reserve and Treasury Department represent unprecedented federal intervention in pay decisions traditionally left to boards and shareholders…..
Pay Master Navigated Some Conflicting Demands – Wall Street Journal
At the heart of Kenneth Feinberg’s job as the Treasury’s special master for compensation has been a series of tense paradoxes.
Among those, as he saw them: Reining in pay while ensuring that key employees stay, and curbing excessive risk-taking yet keeping firms viable. More broadly, he said in an interview, no matter how big an axe he might take to Wall Street pay, he felt the ultimate numbers were sure to stun most Americans.
“The toughest problem I confronted was the chasm between the perceptions of Wall Street and the perception of Main Street. Different planets,” said Mr. Feinberg of his task of crafting pay limits for seven firms receiving large sums of government aid. “No matter what decision I make, Wall Street will be unhappy…and there will be many people who will be unhappy that I didn’t go far enough.”….
Citigroup Taxpayer Ownership Doesn’t Prevent Lobbying – Bloomberg
Citigroup Inc., which has yet to repay $45 billion in federal assistance, has more lobbyists than any other company who registered to try to shape legislation regulating the financial industry, U.S. Senate records show.
The New York-based bank, 34 percent-owned by the U.S. government, is listed as a client by 46 of the 1,537 lobbyists who filed with Congress to work on President Barack Obama’s push for rules to limit financial risks and impose stricter consumer protections…..
CIT and Goldman Strike a Deal on Debt – Wall Street Journal
CIT Group Inc. has reached a tentative deal with Goldman Sachs Group Inc. over a disputed “make whole” payment on a $3 billion loan the investment bank had extended to the lender last year, according to people familiar with the matter.
The people cautioned that the deal had yet to be finalized, but one of these people said it could be inked within the next 24 hours….
Apollo Pulls Off a Turnaround With Funds – Wall Street Journal
Private-equity firm Apollo Global Management posted sharply improved investment performance across all of its funds Thursday, according to company filings and a letter sent to investors.
The results are a remarkable turnabout for the New York-based firm, which struggled mightily during the financial crisis but also bet heavily on distressed investments during the market downturn.
“We were incredibly active during this downturn with respect to new and existing investments, and I am sure that is exactly what you expected of us,” wrote Leon Black in a nine-page letter…
After a Decade-Plus Together, Calpers Reviews Apollo Ties – Wall Street Journal
After entrusting billions to private-equity firm Apollo Global Management, Calpers has embarked on a wide-ranging review of its business with Apollo that examines fees, performance and the “relationship as a whole,” according to documents outlining the review.
The examination, initiated in May and continuing, shows stress lines in one of the longest-standing and most lucrative relationships in the world of private equity. The California Public Employees’ Retirement System has invested with Apollo, run by billionaire investor Leon Black, for more than a decade. It counts Apollo as its biggest private-equity money manager, and even took an ownership stake in the firm two years ago…..
Top execs at rescued auto firms to get 25% pay cut – Detroit Free Press
The government whacked the compensation of top executives at General Motors Co., Chrysler LLC and their financial arms Thursday.
Kenneth Feinberg, an independent official named to make sure taxpayer money isn’t feathering the nests of company bigwigs, also ordered deep cuts for insurance giant AIG and financial houses Bank of America and Citigroup…..
GM Said to Boost CEO Henderson’s Compensation to $5.45 Million – Bloomberg
General Motors Co. will boost total pay for Chief Executive Officer Fritz Henderson under guidelines for recipients of U.S. bailout funds to $5.45 million, a fourfold increase, a person familiar with the plan said.
Henderson’s $1.26 million cash salary will be cut 25 percent to $950,000, said the person, who asked not to be identified because the terms aren’t public. He also will get $4.24 million of stock and restricted stock, the Treasury’s special master for executive pay said in a letter to GM….
Nokia sues Apple to regain market share – Financial Times
Nokia and Apple have been locking horns in the lucrative market for sophisticated smartphones for the past two years. Now they are going to slug it out in the courts as well.
The patent infringement claim from the world’s biggest handset maker, filed in a US Federal court in Delaware on Thursday, pointed to an intensification of the tactical manoeuvring between the two as they fight for the upper hand in one of the tech world’s most promising markets, according to analysts….
Amazon.com Set to Break Dot-Com Record as Profit Tops Estimates – Bloomberg
Amazon.com Inc., cited a decade ago as an example of an overvalued dot-com stock, is poised to rise to a record in Nasdaq trading today after third-quarter earnings trounced analysts’ estimates.
Amazon.com climbed as much as 15 percent to $107.90 in extended trading yesterday, after the world’s largest online retailer reported a 69 percent jump in profit and a 28 percent gain in revenue. The shares, up 82 percent this year, reached a split-adjusted record of $106.69 in December 1999…..
Fortune Magazine Cuts Back Number of Issues – Wall Street Journal
Capping a tumultuous year for business magazines, Fortune is planning to publish about one-quarter fewer issues annually and make other changes, joining the ranks of publications scrambling to reinvent themselves in the advertising downturn.
Fortune’s new publishing schedule is part of a remodeling at the magazine that is expected to result in staff cuts and a sharper focus on the long stories that have been its trademark. It isn’t clear yet how many people might lose their jobs.
The revamp is a prelude to broader staff cuts at Time Inc., the Time Warner Inc. magazine unit that includes Fortune, according to people familiar with the matter. Plans haven’t been finalized, they say, but it’s expected that there will be fewer job losses than there were in the restructuring kicked off last fall. That restructuring pared more than 6% of Time Inc.’s work force, or more than 600 positions…..
Tags: Amazon, Apollo, Apple, Autos, Bonuses, Calpers, CIT, Citigroup, Compensation, Fed, GM, Goldman Sachs, Lobbyists, Nokia, Revolving Door
