September 23, 2018

Legg Mason to Financial Crisis: 100 Years, You.

financial-crisis2.jpgThat’s it. It’s official. Worst. Crisis. Ever. If Legg Mason is your gauge on financial crisises, that is.
And since it is such a momentous occasion, guess what this calls for…wait for it…executive bonuses!
Courtesy of footnoted.org, we learn that Chairman and CEO, Mark Fetting’s received approximately a $3M bonus for “leadership of the company during one of the worst financial crises of the last 100 years, which particularly affected financial services companies”
Footnoted goes on to give us some perspective:

Just to make sure, we did a quick check for the word crisis (or crises) at other financial services companies and didn’t come up with anything that even came close. While the word was used in several other proxies, it wasn’t used in a way to justify a bonus and there were no pronouncements about this being the “worst financial crises”.

Okay, so Legg has some melodramatic types writing their filings. But how about some chicanery?:

Equally interesting is that while the board set Fetting’s bonus at 21% of the bonus pool in June 2008, Legg Mason’s loss of $1.9 billion last year meant that there was no bonus pool. But that didn’t stop the bonus because as the comp committee writes in the proxy the net loss was due to just two items and without those two items, the company “would have had net income, and the plan would have produced a total bonus pool large enough to accommodate the annual incentive awards made. Although the terms of the plan do not explicitly provide for the exclusion of those items, the Committee considered the items to be extraordinary expense.”

Seriously, who’s going to let two measly items stop them from paying executives bonuses out of a bonus pool that didn’t really exist? This is financial wartime people, we will not be denied.

Legg Mason calls it: The worst financial crisis
[footnoted.org]

financial-crisis2.jpgThat’s it. It’s official. Worst. Crisis. Ever. If Legg Mason is your gauge on financial crisises, that is.
And since it is such a momentous occasion, guess what this calls for…wait for it…executive bonuses!
Courtesy of footnoted.org, we learn that Chairman and CEO, Mark Fetting’s received approximately a $3M bonus for “leadership of the company during one of the worst financial crises of the last 100 years, which particularly affected financial services companies”
Footnoted goes on to give us some perspective:

Just to make sure, we did a quick check for the word crisis (or crises) at other financial services companies and didn’t come up with anything that even came close. While the word was used in several other proxies, it wasn’t used in a way to justify a bonus and there were no pronouncements about this being the “worst financial crises”.

Okay, so Legg has some melodramatic types writing their filings. But how about some chicanery?:

Equally interesting is that while the board set Fetting’s bonus at 21% of the bonus pool in June 2008, Legg Mason’s loss of $1.9 billion last year meant that there was no bonus pool. But that didn’t stop the bonus because as the comp committee writes in the proxy the net loss was due to just two items and without those two items, the company “would have had net income, and the plan would have produced a total bonus pool large enough to accommodate the annual incentive awards made. Although the terms of the plan do not explicitly provide for the exclusion of those items, the Committee considered the items to be extraordinary expense.”

Seriously, who’s going to let two measly items stop them from paying executives bonuses out of a bonus pool that didn’t really exist? This is financial wartime people, we will not be denied.

Legg Mason calls it: The worst financial crisis
[footnoted.org]

Related articles

Grant Thornton and the Antichrist

al pacino_devil.jpgIt’s rather mysterious that the New York office of Grant Thornton is located at 666 Third Ave. As I’m sure our more pious readers know, the significance of the 666 is commonly known as “The Number of the Beast“. We won’t get into any more specifics than that other than to mention that it is a pretty creepy-ass looking number.
Is G to the T run by a secret group of Al Pacino-esque figures that are working against the forces of good?
Maybe not but the otherwise boring-assness of that particular lobby is def working too hard to not be noticed…