In what is probably the biggest remuneration report ever produced, pages 48 to 90 of Macquarie Bank’s 2007 annual review give chapter and verse on who is getting what at the Millionaires Factory.
And record profits mean record bonuses that will surely finally place a handful of Macquarie Bankers onto the 2007 BRW Rich List when it is released later this month.
If bankers collecting $20 million a year caused a storm 12 months ago, what will the $33.45 million pay packet of CEO Allan Moss do this year?
In fact, as the following table shows, the top six Macquarie Bank executives shared a staggering $160.32 million in the 12 months to 31 March, 2007.
Top Six Pay Packets
Investment banking boss
As usual, the bonuses represent more than 90% of all pay packets as none of these lads are guaranteed more than the $670,811 base pay of Allan Moss.
Chairman and co-founder David Clarke has gone out with a bang with a final payout of $18.96 million before he becomes Australia’s highest paid non-executive chairman on a base fee of $680,000 a year.
Clarke offloaded 326,135 shares during the year but retains 651,113 shares worth $58.3 million, albeit with a $30 million loan still owed back to the bank.
Despite the mind-boggling numbers, don’t be surprised when shareholders give the remuneration report another 90%-plus voted at the AGM because the disclosure is excellent and this group ahs lifted Macquarie Bank shares from $6 to $90 since the 1996 float.
The bank’s bonus system has a strong long-term focus which locks executives into the future, so it’s no coincidence that the same names have been appearing in Macquarie’s top pay packet lists for the last few years.
The bank finished the year with just over 10,000 staff who shared an average pay packet of $360,000. Exactly 50% of the bank’s $7.18 billion in income goes to employees and the remuneration report points out this as in line with its competitors and US consultant Towers Perrin has approved it.
Shareholders have absolutely nothing to complain about, it’s Macquarie customers, clients and counter-parties who should perhaps be scratching their heads about getting out-smarted by what is now arguably the world’s biggest private equity firm.