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Morgan Stanley Pays CEO $40 million Bonus

Morgan Stanley Inc., America`s second largest investment house, gave its CEO, John Mack, a cash and stock bonus of $40 million for the year 2006. This is the highest bonus ever given to a CEO on Wall Street. According to a report the company filed to the Securities and Exchange Commission during the weekend, Mack, who is 62-years-old, was given 461 thousand shares worth $36.2 million, as well as, 179 thousand options to buy Morgan Stanly shares worth about $4 million, on December 12.

Morgan Stanley is expected to report Tuesday that 2006 has been the best the company had ever had due to a record-braking year in the stock market and an unprecedented number of mergers and acquisitions. The investment houses, Goldman Sachs and Bear Stearns have already reported record braking profits.

Mack received his bonus 18 months after returning to Morgan Stanley, after the company sorted out internal problems, which resulted in the ousting of former CEO Philip Purcell. At the time, Mack promised investors that he would raise stock prices and increase the company`s profitability, and it seems that he is holding up his end of the bargain. Since Mack returned to the company in June 2005 the company`s shares have risen 62% and analysts estimate that the company will report profits of $6.77 a share or $33.73 billion. Mack received a bigger bonus than the bonus Goldman Sachs`s former-CEO Henry Paulson, who is currently Secretary of Finance, received in 2005, $38.3 million.