FleetBoston Financial Corp. cut Terrence Murray’s 2001 pay by 49 percent in his last year as chief executive officer as the bank wrote off loans in Argentina and investments in technology companies.
Murray, 62, was paid a $992,200 salary, a $2.5 million bonus and other compensation totaling $652,280, according to the company’s proxy statement filed with the Securities and Exchange Commission. He also was given stock options worth $4.6 million on the day they were granted. His total pay in 2000 was $17 million.
The Wall Street Journal reported that Murray’s annual pension would be $5.8 million after retirement.
Charles Gifford, 59, who became CEO at the beginning of the year and was chief operating officer in 2001, was paid a $992,200 salary, a $2.25 million bonus and $304,550 in other compensation and stock options worth $2.77 million on the day they were granted. That’s 33 percent less than the $9.4 million in salary, options and other compensation Gifford received in 2000.
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“Last year was like the perfect storm for FleetBoston,” said Michael Holton, an analyst with T. Rowe Price & Associates, which owned about 8.4 million FleetBoston shares at the end of 2001. “A number of negative events all hit at once and made it a very difficult year.”
Shares of FleetBoston fell 2.8 percent in 2001, while the Standard & Poor’s index of 24 banks fell 2.4 percent. Last year FleetBoston’s earnings slid 76 percent to $931 million from $3.9 billion a year earlier.
Argentina’s debt default and the devaluation of its currency cut the Boston-based bank’s earnings in the fourth quarter by $628 million, more than any other U.S. bank in the period. Murray, who is the bank’s chairman, exercised stock options worth $4.45 million last year, according to the filing. Gifford exercised options on shares worth $26,233.
Shares of FleetBoston rose 41 cents today to $36.33.
Bloomberg News
