Morgan Stanley: John Mack will be going without a bonus for the third year in a row. The outgoing Morgan Stanley boss has said he doesn't want a penny, despite the firm's recovering health.
If Lloyd Blankfein, his counterpart at Goldman Sachs, was expecting his share of the Wall Street titan's $20 billion payout pot, Mack's move just made his PR job harder. The same goes for the rest of Mack's Wall Street peers.
Morgan Stanley was certainly one step closer to the abyss than Goldman at the height of last year's crisis. That explains Mack's recognition, in a letter to employees before he steps down as chief executive at the end of the year, of the government's role in propping up the world of finance and the need for tighter regulation.
Nonetheless, a case could be made for Mack collecting a bonus before clearing the corner office for James Gorman.
He will remain as chairman. Like other banks, Morgan Stanley is back on its feet and set to resume payouts to top executives after last year's hiatus for most of the industry. Morgan Stanley's conservative post-crisis approach left it with a very modest 5.8 percent return on equity in the third quarter, and analysts reckon the firm will make a modest loss for the year.
Though Mack could justify a bonus, it wouldn't be anywhere near as big a payday as Blankfein could argue for at Goldman, where the business is once again going great guns and set for big profits. Even so, Goldman is in the public and political crosshairs over perceived special bailout treatment and the $20 billion-odd it looks on track to pay out to employees.
That already made the boss's bonus a sensitive matter. Now that Mack has said "no, thanks," the case for a bonus -- reasonable under normal circumstances -- has become that much harder to make at Goldman and elsewhere.
