Why Is This Man Smiling?
In a move that makes most many old-line Wall Street bank heads look like paupers, it was announced yesterday that Wachovia vice chairman is parachuting out of his 15-month tenure with $135 million tucked under his arm. Wallace D. Malone, who ran SouthTrust bank for many years before selling it to Wachovia in November 2004, was able to get the Wachovia board to sign off on the massive retirement package he had accumulated before the merger. According to securities filings, Malone gets “termination payments” totaling about $33.4 million over the next five years, an amount equal to five times his salary and the highest annual bonus he ever received. On top of that, he will cash in on retirement benefits and deferred compensation worth over $82 million. That shit goes a long way in Charlotte!
Banker to Receive $135 Million Parachute [NY Times]
Morgan Stanley Loses Another One, From Prop This Time
Geez, is there anybody left at Morgan Stanley? The latest news is that London Prop Trading co-head, Michael Frydman has jumped ship to a gig at UK hedge fund Peloton Partners. Founded in 2005 by three Goldman Sachs partners--Ron Beller, Geoff Grant and Max Trautman--Peloton uses global macro and relative value hedge fund strategies and trades primarily in the fixed-income, foreign exchange and commodity markets.
Morgan Stanley’s Frydman Takes the HF Shilling [FT]
Bubble Shmubble Say Flush Wall Streeters
With bonus checks just starting to clear, the young and newly-monied Wall Streeters are pushing aside the pundits’ calls of a real estate bubble and snatching up Manhattan properties like there’s no tomorrow.
Keith Copley, of Sotheby’s International Realty in Manhattan, is seeing bidding wars, mostly among young hedge fund players. ”The bonuses are rolling in and people are going crazy.” Three are competing for a “celebrity style loft” called the Glass Farmhouse, with views of the Hudson River, for sale for about $8 million. “All these guys are in their thirties,” he says, and he expects a deal soon.
Wall Streeters Ignore Bubble [The Australian]
Wall Street Bonuses Match Afghanistan’s GDP
A columnist for the Baltimore Sun puts this year’s bonus season in a global perspective:
Now I do not begrudge the bonuses or the amounts. That’s the way it works, and as long as shareholders think it’s OK, that’s how it will continue to work. But, seriously, something’s wrong with this picture. According to the CIA’s ranking of gross domestic products (purchasing power parity) around the world, $21.5 billion is more money than the GDP of each of two-thirds of the world’s countries. The 2005 bonus amount distributed among 172,000 people was exactly the same as the 2004 GDP of Afghanistan, population 30 million.
Street Bonuses Dwarf Some Economies [Baltimore Sun]
Hong Kong Bankers Defecting in Droves
That giant sucking sound coming from the other side of the world might just be the mass exodus of investment bankers in Hong Kong grabbing their bonus checks and rushing out the door to join private equity and hedge funds. The lure, according to the South China Morning Post, is two-fold: A more flexible work environment and the chance to make more money. Oh, and did we mention the chance to make more money?
Open Season on Talent in HK [South China Morning Post]
