Strip club boss earns more than bankers’ US$500,000 limit
Half a million dollars may not buy a seasoned banking executive these days
Bloomberg 13 February 2009
(NEW YORK) Eric Langan could run a US bank, based on his US$494,713 salary last year, according to President Barack Obama. But Mr. Langan would rather stay in his job, overseeing 18 strip clubs as chief executive officer of Rick’s Cabaret International Inc.
‘A bank? No. I’m not interested in working for a bank,’ he said by telephone from his office in Houston. Besides, he just got a raise to US$600,000, putting him US$100,000 over Mr. Obama’s cap for a top official of a financial institution receiving federal bailout funds.
A half-million dollars may not buy a seasoned executive for a major US financial institution, said James Reda, managing director of James F Reda & Associates, a compensation consultant in New York.
Linda McMahon, whose World Wrestling Entertainment produces the syndicated television show WWE Friday Night Smackdown, would make the cut, as would CEOs of a cafeteria company and discount online retailer.
On Wall Street, ‘US$500,000 will get you someone five years out of Harvard Business School or a sixth-year associate at a major law firm,’ Mr. Reda said.
Just 14 CEOs in the Fortune 1,000 and five from the companies in the Standard & Poor’s 500 Index make under the US$500,000 bar, according to Equilar Inc, which analyses compensation data. Many of those are founders or major shareholders, such as Apple’s Steve Jobs, who gets a US$1 annual salary and owns about US$550 million in stock.
CEOs coming in under the Obama ceiling managed companies with a median market value of US$182.6 million and sales of US$152.6 million in 2007, according to Equilar.
The heads of the five biggest Wall Street firms took home more than US$1 billion in the five years through 2007, according to Bloomberg data. Bank of America Corp was worth US$35.4 billion on Tuesday.
‘These mega-banks just live in a different universe,’ said Tony Gorrell, chief financial officer of closely held Sutton Bank of Attica, Ohio, which has nine branches. His salary is ‘not even close’ to reaching the half-million mark, he said.
The US$500,000 rule applies to banks that receive capital injections under the programme outlined by Treasury Secretary Timothy Geithner on Tuesday, and not to the 361 financial institutions that already received Troubled Asset Relief Program (TARP) aid.
They paid their CEOS an average US$3.65 million annually, Equilar said. Those with assets above US$10 billion gave their chiefs an average US$11 million, the firm said.
The rules announced by Mr. Obama on Feb 4 limit total compensation, including salary, bonus and stock. Awards of restricted shares, which cannot be sold until taxpayers are paid back with interest, are allowed. Perks including country club memberships and use of corporate jets are not banned, according to the Treasury Department.
A corporate leader grossing US$500,000 would earn about US$300,000 after taxes, said Milton Pedraza, CEO of the Luxury Institute, a New York-based market researcher.
CEOs with pay cheques of less than US$500,000 a year include Ms. McMahon of World Wrestling Entertainment and Christopher Pappas, who runs Luby’s Inc, a cafeteria-style restaurant chain in Houston.
Ms. McMahon, who made US$498,227 in 2007, has been nominated to the Connecticut Board of Education and is too busy to answer questions, said her spokesman, Robert Zimmerman. Mr. Pappas, who gets a US$400,000 annual salary, also declined to comment, said spokesman Rick Black.
Mr. Langan, CEO of Rick’s Cabaret, said that he doubts that any of the dancers at his Rick’s Cabaret, Club Onyx, XTC Cabaret or Tootsie’s night clubs would seek new careers in finance.
‘I’ve got girls making over a quarter of a million a year in New York,’ he said.
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Strip club boss earns more than bankers’ US$500,000 limit
Half a million dollars may not buy a seasoned banking executive these days
Bloomberg
13 February 2009
(NEW YORK) Eric Langan could run a US bank, based on his US$494,713 salary last year, according to President Barack Obama. But Mr. Langan would rather stay in his job, overseeing 18 strip clubs as chief executive officer of Rick’s Cabaret International Inc.
‘A bank? No. I’m not interested in working for a bank,’ he said by telephone from his office in Houston. Besides, he just got a raise to US$600,000, putting him US$100,000 over Mr. Obama’s cap for a top official of a financial institution receiving federal bailout funds.
A half-million dollars may not buy a seasoned executive for a major US financial institution, said James Reda, managing director of James F Reda & Associates, a compensation consultant in New York.
Linda McMahon, whose World Wrestling Entertainment produces the syndicated television show WWE Friday Night Smackdown, would make the cut, as would CEOs of a cafeteria company and discount online retailer.
On Wall Street, ‘US$500,000 will get you someone five years out of Harvard Business School or a sixth-year associate at a major law firm,’ Mr. Reda said.
Just 14 CEOs in the Fortune 1,000 and five from the companies in the Standard & Poor’s 500 Index make under the US$500,000 bar, according to Equilar Inc, which analyses compensation data. Many of those are founders or major shareholders, such as Apple’s Steve Jobs, who gets a US$1 annual salary and owns about US$550 million in stock.
CEOs coming in under the Obama ceiling managed companies with a median market value of US$182.6 million and sales of US$152.6 million in 2007, according to Equilar.
The heads of the five biggest Wall Street firms took home more than US$1 billion in the five years through 2007, according to Bloomberg data. Bank of America Corp was worth US$35.4 billion on Tuesday.
‘These mega-banks just live in a different universe,’ said Tony Gorrell, chief financial officer of closely held Sutton Bank of Attica, Ohio, which has nine branches. His salary is ‘not even close’ to reaching the half-million mark, he said.
The US$500,000 rule applies to banks that receive capital injections under the programme outlined by Treasury Secretary Timothy Geithner on Tuesday, and not to the 361 financial institutions that already received Troubled Asset Relief Program (TARP) aid.
They paid their CEOS an average US$3.65 million annually, Equilar said. Those with assets above US$10 billion gave their chiefs an average US$11 million, the firm said.
The rules announced by Mr. Obama on Feb 4 limit total compensation, including salary, bonus and stock. Awards of restricted shares, which cannot be sold until taxpayers are paid back with interest, are allowed. Perks including country club memberships and use of corporate jets are not banned, according to the Treasury Department.
A corporate leader grossing US$500,000 would earn about US$300,000 after taxes, said Milton Pedraza, CEO of the Luxury Institute, a New York-based market researcher.
CEOs with pay cheques of less than US$500,000 a year include Ms. McMahon of World Wrestling Entertainment and Christopher Pappas, who runs Luby’s Inc, a cafeteria-style restaurant chain in Houston.
Ms. McMahon, who made US$498,227 in 2007, has been nominated to the Connecticut Board of Education and is too busy to answer questions, said her spokesman, Robert Zimmerman. Mr. Pappas, who gets a US$400,000 annual salary, also declined to comment, said spokesman Rick Black.
Mr. Langan, CEO of Rick’s Cabaret, said that he doubts that any of the dancers at his Rick’s Cabaret, Club Onyx, XTC Cabaret or Tootsie’s night clubs would seek new careers in finance.
‘I’ve got girls making over a quarter of a million a year in New York,’ he said.
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