Morgan Stanley (MS) - Get Report investors signed off on a 7.1% pay hike for CEO James Gorman, whose streamlining plan is on track to reduce costs by $1 billion as the investment bank works to boost dividends and stock-buybacks.
Gorman's pay increased to $22.5 million in 2016, according to a regulatory filing, a raise 90% of shareholders approved in a nonbinding "Say on Pay" vote at the company's annual meeting Monday in Purchase, N.Y. The bank's fixed-income trading revenue nearly tripled during the year, despite trimming staff by 25%, and the 58-year-old CEO returned $4.8 billion to investors, a 50% increase from 2015.
"Our financial performance has steadily improved," Gorman told shareholders at the meeting. "While there is more work to be done to achieve our goals, we are clearly moving in the right direction."
Like its competitors, Morgan Stanley has benefited from geopolitical surprises including Britain's decision to leave the European Union and Donald Trump's victory in the U.S. presidential race as well as speculation that a Republican-controlled government would roll back at least some of the stricter regulations placed on Wall Street in the wake of the 2008 financial crisis.
The New York-based bank's shares have climbed 23% to $41.72 since the election, outpacing a 12% increase on the broader S&P 500.
Morgan Stanley's 13 board nominees, including former British Chancellor of the Exchequer Alistair Darling and former White House Chief of Staff Erskine Bowles, all received support from at least 98% of shareholders.
Nominee Klaus Kleinfeld, 59, who recently stepped down as CEO of aluminum-parts producer Arconic (ARNC) - Get Report after sending what its board described as a poorly-judged letter to activist shareholder Elliott Management's Paul Singer, didn't stand for re-election, the bank said. Kleinfeld had been on Morgan Stanley's board since 2012, according to a filing.