By Frank James
Jamie Dimon, CEO of JP Morgan Chase, is one of the biggest of the big dogs on Wall Street.
So a lot of people were waiting to see what his "number" would be, his 2009 bonus. The wait is over; he will get a bonus valued at around $17 million according to a company filing with the SEC. But instead of it being in cash, it will be in stock and options.
The non-cash approach is all the rage on Wall Street for the topmost executives at the big firms, as companies try to show that they got the message that Washington policymakers and voters are outraged by Wall Street compensation that in past years past resembled Powerball prizes.
Especially galling has been companies paying bonuses after they and their industry were bailed out by billions of dollars from taxpayers.
By getting stock, Wall Street's top bankers are trying to demonstrate that they have a stake in their companies not taking foolish, short-term risks since that could negatively impact the value of their stock bonuses.
According to the SEC filing, Dimon would receive 195,704 units in restricted stock and 563,562 stock options.
Now all eyes turn to the bonus watch for Lloyd Blankfein, Goldman Sachs' CEO. There's been speculation that he could come in with a really big number, maybe even $100 million, although those who are talking don't know and those who know aren't talking.
The Wall Street Journal adds some context to the Wall Street bonus picture:
Among this year's Wall Street pay packages that will be eyed closely is that of Goldman Sachs Group CEO Lloyd Blankfein. A regulatory disclosure is expected later this month. The Wall Street giant already has bowed to public pressure to cut the size of its bonus pool and has set aside $16.19 billion for compensation, about $3 billion less than expected.
Elsewhere, Citigroup Inc. CEO Vikram Pandit received $1 in total compensation last year, at his request. Morgan Stanley CEO James Gorman received no cash bonus but could receive equity compensation of up to $9 million.
But boutique investment bank Lazard Ltd. this week sweetened its compensation pool for 2009 and said it hopes to lure bankers who have grown disenchanted with pay restrictions elsewhere.
Mr. Dimon's "bonus looks to be 'in-between' to me," said Nancy Bush, the owner of NAB Research, an independent research firm. "A concession to Washington, but definitely not a 'bowing down.'"
J.P. Morgan's board voted to give Mr. Dimon 195,704 units of restricted stock and 563,562 options, according to a filing with the Securities and Exchange Commission Friday. He had received no cash or equity bonus for 2008, after a $28 million bonus for 2007. Overall, executive compensation at J.P. Morgan is down an average of 41% from 2007.
Mr. Dimon, a Democrat, has been more receptive than many bankers to political criticism, although he lays the blame for the crisis broadly among bankers, their regulators, and U.S. consumers. He also has often said compensation needs to remain competitive.