More cause and effect at First Marblehead…
When we last footnoted First Marblehead (FMD) back in mid-November, the stock was trading at over $30 a share. Five weeks later, it had fallen 65%.
Now, word comes in the form of this 8-K that First Marblehead’s two most senior executives — CEO Jack Kopnisky and Chairman Peter Tarr — are feeling simpatico with some of the company’s investors and have asked for a 25% pay cut effective Feb. 1, when their salaries will drop to $750K for the rest of this year.
Granted, real parity would have been a 65% cut. Still, considering how few top executives voluntarily ask for a cut in pay, even when the stock sinks on their watch, this move certainly seems worthy of a gold star.
UPDATE: Due to some technical problems, there will be no post on Monday Feb. 11. We’ll be back tomorrow.
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Posted in Tags: 8Ks, high flyers |
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February 8th, 2008 at 10:32 pm
First Marblehead also layed off 20% of their staff. One whole department saw close to 70% of their staff go. They recieved the news via email in the middle of the work day.
Classy.
February 10th, 2008 at 7:55 pm
Hmmmm…
This seems to me as if it was either “recommended” by the Board or these two guys are trying to win friends in the event a class-action law suit develops or if they get sued by borrowers who were steered into non-subsidized student loans. We are going to hear I think a lot, lot more about Marblehead in the coming years.