Macquarie Paid CEO Allan Moss $33 Million, Is He Worth It?


To be honest, we don’t care how much Alan Moss, chief executive officer at Macquarie Bank (ASX: MBL) earns.  Is it really any skin off of your correspondent’s or anyone else’s nose if Emperor Moss earns $33 million a year?

Clearly $33 million is more than most people need.  Arguably no-one, however good there are at something is really ‘worth’ that amount of money.  But what business is it of ours?  Hands up anyone out there who would refuse a bonus payment?

Even if you thought you didn’t really deserve the bonus because, well, things just kind of happened around you anyway – as long as you pointed it in the right direction it managed to hit the target most of the time.

From where we are sitting, Emperor Moss has done exactly the same thing, only on a bigger scale.  Some may argue that his army of investment bankers have used the scatter-gun approach to growing revenues and profits.  Or to coin the slightly more colourful phrase, “throw enough _ _ _ _, some of it will stick!”

But of course some of it hasn’t stuck.  Instead it has just left a bit of a smell.  The London Stock Exchange attempted acquisition of last year and more recently the Qantas debacle, both left the bank with a more than tarnished image.

Besides, Moss’s income is still much lower than many of the US company executives, and shock-horror, much less than sports stars such as Michael Schumacher and Tiger Woods.

If Macquarie Bank shareholders are happy enough to be paying him that amount of salary then that is up to them.  Afterall, from a shareholders perspective, they will be judging his performance based on the performance of the shares.  If the bank continues to see strong growth then we would imagine that most shareholders will be happy to continue forking out the high salaries.

Perhaps the senior executives are merely making hay while the sun shines.  They would know that if/when the good times end for Macquarie Bank then they will also end for the executives.

Staying on the same subject (and apologies for our laziness in not checking fully) we seem to recall that it was also within the last couple of years, at the same time that the CEO’s salary was announced, that Macquarie Bank issued new shares.

The bank’s shares were suspended from trading as they went through the process of issuing 8.6 million new shares at $87 per share.  This was at a discount to the previously traded price of $89.50.

One may have been forgiven for thinking that a dilution of shares in the company may have had a negative effect on the share price.  Not likely!  Thanks to the increased profit results, Macquarie shares opened for trade higher after the trading halt was lifted, giving a quick stagging opportunity for those that were able to participate.

According to Reuters, the last time Macquarie had a capital raising was in May 2006 when they sold $700 million worth of new shares in order to beef up their tier 1 capital.

Kris Sayce
for The Daily Reckoning Australia

Kris Sayce
Kris Sayce, dubbed the ‘Jeremy Clarkson of Australian finance’, began as a London finance broker specialising in small-cap stock analysis on London’s Alternative Investment Market (AIM). Kris then spent several years at one of Australia's leading wealth management firms. A fully accredited advisor in shares, options, warrants and foreign-exchange investments, Kris was instrumental in helping to establish the Australian version of the Daily Reckoning e-newsletter in 2005. He is currently the Publisher, Investment Director and Editor in Chief of Australia's most outspoken financial news service — Money Morning.

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3 Comments on "Macquarie Paid CEO Allan Moss $33 Million, Is He Worth It?"

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9 years 5 months ago

$33m IS a lot.

So is $15m or $16m in taxes.

So the guy will have about $17m as disposable income. He pays as much tax as probably 100,000 average working Australians.

Why isn’t there a similar outrage over the amount of tax that is taken out of his pay packet?

David Ambler
David Ambler
9 years 5 months ago

Directors salaries seem to be on a self perpetuating upward spiral. It is no wonder. Large blocks of shares will always vote in the affirmative for massive salaries, payouts, entitlements etc because it seems that these decisions are made by, who else, but other company directors who may well benefit the next time around. Take out the votes of the large institutions and leave it to the “mum and dad” and smaller investors and I feel there is no way the trough will be continually topped up with swill.

jane barrett
jane barrett
8 years 4 months ago

Alan Moss should pay my mortgage which has been steadily going up over the last few months. The topping on the cake was two massive interest rises in two months, nearly 6 hundred dollars over two months. please enjoy your pay Mr Moss while we struggle to keep our home with your greedy banks rate hikes well above all others!

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