By Emily Glazer And Justin Baer
Two Wall Street giants are putting more cash in their CEOs'
pockets this year.
J.P. Morgan Chase & Co. and Goldman Sachs Group Inc.
increased cash bonuses for their top executives after the two firms
reported higher profit for 2014, despite headwinds such as a tough
trading environment and low interest rates.
At J.P. Morgan, the nation's largest bank by assets, Chairman
and Chief Executive James Dimon will receive $7.4 million of his
overall $20 million pay package for 2014 in a cash bonus, his first
since 2011, the bank said Thursday. His overall pay award remained
flat from the prior year.
Goldman, meanwhile, awarded its chairman and CEO, Lloyd
Blankfein, a cash bonus of about $7.3 million, up $1 million from
the prior year, as part of his $24 million pay package, according
to a securities filing released Thursday and a person familiar with
the matter.
Mr. Blankfein's stock bonus and salary stayed constant, meaning
his overall pay package was up 4% from last year's $23 million
award.
The moves come as other Wall Street firms such as Morgan Stanley
increase the percentage of their employee bonuses that are paid
immediately rather than deferred over several years. Federal
banking regulators have encouraged deferred bonuses since the
financial crisis to discourage risky behavior by traders and other
bank employees, and most Wall Street firms still defer significant
chunks of compensation for top executives and other traders and
bankers.
The disclosure of Mr. Dimon's pay follows a year in which J.P.
Morgan garnered record annual profit while Mr. Dimon and fellow
executives dealt with a cyberattack and steered the bank through
complex foreign-exchange settlements that involved multiple
regulators and financial institutions.
Mr. Dimon and Mr. Blankfein are making more per year than they
did right after the financial crisis but less than they did before
it and well below what some top hedge-fund managers and
private-equity titans earn.
Mr. Dimon's pay package includes an $18.5 million bonus, with
$11.1 million in restricted stock and $7.4 million in cash, along
with his base salary of $1.5 million, according to a regulatory
filing and the bank. The new cash portion of his bonus was offset
by a 40% decline in the stock-based portion.
Mr. Dimon took a high-profile pay cut for 2012, a year when J.P.
Morgan suffered a roughly $6 billion trading loss, an incident that
came to be known as the "London whale" because it originated with a
trader in the firm's London office.
The last year was a more challenging one personally for the
longtime chairman and CEO, who disclosed he had throat cancer in
July but remained involved in the day-to-day business during his
roughly eight-week treatment. In December, Mr. Dimon told employees
that tests showed no evidence of cancer in his body.
At Goldman, Mr. Blankfein received 83,510 restricted shares,
half of which are "subject to performance conditions," according to
a regulatory filing. The stock, which vests over several years, is
valued at about $14.7 million.
Goldman profit rose 5% as revenue hovered around $34 billion for
a third straight year. Banner years by the firm's investment
bankers and investment managers helped offset a trading slump that
has dogged Wall Street. The firm's total expenses from employee pay
and benefits increased 1% to $12.69 billion.
In recent years, Goldman has paid out about 70% of its senior
leaders' bonuses in shares.
This year, though, Mr. Blankfein received a slightly thicker
slice of his payout in cash, a person familiar with the matter
said. The $7.3 million cash bonus and a $2 million salary bring his
total pay to $24 million, the person added. The value of the
package will fluctuate in the future based on Goldman's share
price.
Mr. Blankfein received $23 million in salary and bonus for his
2013 performance and remained eligible to collect an additional $6
million if Goldman hits certain targets over the next several
years.
The award made Mr. Blankfein the highest paid CEO of the six
biggest US banks after a four-year period in which commercial bank
heads such as Mr. Dimon earned more.
Write to Emily Glazer at emily.glazer@wsj.com and Justin Baer at
justin.baer@wsj.com
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