(Updates stock price moves throughout)

Financial stocks finished lower Monday, with

E*Trade Financial

(ETFC) - Get E*TRADE Financial Corporation Report

among the decliners after the company announced it has launched a debt exchange.

E*Trade on Monday launched a

$1 billion debt exchange offering

as part of its

capital restructuring plan

announced last week.

E*Trade is offering to exchange more than $1 billion of convertible debentures due in 2019 for all of its 8% senior notes due in 2011. The company is also offering the exchange to holders of a portion of its 12.5% springing lien notes due in 2017, it said. Citadel Investment Group, E*Trade's largest stock and bondholder, has agreed to participate in the debt exchange offer.

Shares of E*Trade ended down 5.6% to $1.19. The stock is still higher by about 7% in 2009.

TD Ameritrade

(AMTD) - Get TD Ameritrade Holding Corporation Report

shares slid 4.2% to $16.63.

Goldman Sachs

(GS) - Get Goldman Sachs Group, Inc. (GS) Report

is reportedly on pace to pay out record bonuses after a strong first half of 2009.

The Guardian

reported that the firm's London staff they could look forward to the bonus hikes if the company registers its most profitable year ever. A drop in competition and a surge in revenue from trading foreign currency, bonds and fixed-income products have benefitted the company, the newspaper said.

Goldman shares finished down 4.3% to $137.01. Among related stocks,

JPMorgan Chase

(JPM) - Get JPMorgan Chase & Co. (JPM) Report

was gave back 6.1%,

Morgan Stanley

(MS) - Get Morgan Stanley (MS) Report

slid 5.8%, and

TheStreet Recommends


(BCS) - Get Barclays PLC Sponsored ADR Report

lost 7.2%.



(C) - Get Citigroup Inc. Report

said late Friday that

Ajay Banga

, the chief executive of Citi Asia Pacific, will leave the firm to assume the number two spot at


(MA) - Get Mastercard Inc. (MA) Report


Banga, who has been with Citi for the past 13 years, will join MasterCard in August to become president and chief operating officer , as well as heir apparent to CEO Robert Selander, according to

The Wall Street Journal


Citi shares fell 5.4% to $3. MasterCard shares declined 2.8% to $156.78.

Royal Bank of Scotland

(RBS) - Get Royal Bank of Scotland Group plc Sponsored ADR Report

shares were losing more than 2% after a report that the bank will unveil a 9.6 million pound pay package for CEO Stephen Hester, after securing support for a long-term incentive plan from shareholders last week.

The Financial Times

reported that the long-term incentive plan relies on a mix of targets, including relative total shareholder return and absolute share price performance.



report comes just days after the group's former CEO, Fred Goodwin, agreed to take a sharp reduction in his annual pension. RBS shares fell 4.7% to $11.67.

Among analyst moves, RBC Capital Markets upped its stock price target for

Discover Financial Services

(DFS) - Get Discover Financial Services Report

to $10 from $8, although the stock still finished lower Monday. Discover dipped 0.1% to $9.31.