|Ronald Logue retired from State Street in January.|
Logue receives final million-dollar payout from State Street
Ronald Logue ended a two-decade tenure at State Street Corp., the last six years as its chief executive and then chairman, with a final million-dollar payout and a few last perks.
The Boston financial services giant disclosed yesterday that Logue received $1.6 million in stock last year that he had earned as part of a performance-based bonus plan. For the two months of 2010 that he served as chief executive, Logue was paid $176,923 in salary. He received another $416,667 for being chairman of the company’s board of directors the rest of the year. The company also recorded an additional $8.4 million cost for his pension.
Logue retired as company chairman in January after leading State Street through overseas expansion and financial tumult at home. During his tenure, State Street bought companies with operations in Europe and Asia that extended its reach into many of the world’s major financial markets. But under his watch State Street also incurred painful losses from the credit crisis. In 2009, it took a $3.7 billion charge to cover bad investments and set aside hundreds of millions of dollars to settle lawsuits brought by customers who lost money in bond funds hurt by risky positions.
In 2008 he was among the highest paid chief executives of of a publicly traded company in Massachusetts, with a compensation pack age worth $24.5 million. He also previously received a $6 million “transition award’’ at his stepping down as chief executive.
State Street has since recovered. Last year it reported revenues increasing 4 percent to $9 billion and earned $1.6 billion after losing $1.9 billion in 2009. And in March, federal regulators approved the company’s request to raise its quarterly dividend from a penny to 18 cents a share after demonstrating its financial situation was sound. The company, best known for providing custodial banking for institutions and managing investments, has 28,600 workers in 26 countries.
State Street’s stock, including dividends, rose 7 percent last year, less than the increase for the Standard & Poor’s 500 index of major companies and S&P’s index of financial firms. But over the past five years, it has held up better than many financial firms that were ravaged by the credit crisis. Shares closed yesterday at $46.37, up 1 percent.
In its annual proxy statement filed with regulators yesterday, State Street disclosed that Logue received a number of perquisites last year, including $31,506 in retirement gifts, a car and driver valued at more than $74,000, and home security services costing $114,000. Logue also received a vacation payout of $61,538.
He has been succeeded as chief executive by Joseph L. Hooley, who received $12.9 million in total compensation last year, a 7 percent drop from the year before, according to the main compensation table in the company’s filing.
A State Street spokeswoman points out the primary compensation table required by the Securities and Exchange Commission skews the timing of some of the executives’ compensation. For example, some of the stock grants attributed to Logue and other executives for 2010 were actually for work performed the previous year. Like many companies, State Street typically makes its annual stock grants in February, to reward executives for the previous year. But the SEC requires companies to report stock awards in the same year they were awarded.
By State Street’s calculations, Hooley’s pay actually increased from $9.5 million in 2009, when he was the company’s chief operating office, to $12.9 million in 2010, when he succeeded Logue.
Some of the stock awards contain restrictions, so executives may not be able to cash in all those shares immediately. And the actual value that executives receive in cash depends on when they sell the stock and how the stock performs.
The highest paid State Street executive last year was Scott F. Powers, who runs State Street’s investment management unit and received $13.5 million in total compensation. That includes $8.8 million in stock awards and a $3.7 million bonus. State Street said a portion of the award was to recognize his leadership in dealing with issues stemming from the financial crisis and was intended to help retain him.
Todd Wallack can be reached at firstname.lastname@example.org.