Grasso's deputy to earn $37.5M

By Jed Horowitz
Bloomberg News Service

William R. Johnston's seven years as the top deputy to ousted New York Stock Exchange Chairman Richard Grasso will earn him a total of $37.5 million, according to exchange documents.

Johnston, 63, was lured by Grasso from his job as a trader to become exchange president in 1996 with an $850,000 signing bonus and will get $6 million over two years when he leaves in December. In between, he also accumulated almost $30.6 million in salary and pension benefits.

Grasso recommended compensation for Johnston and five other exchange executives and the NYSE board approved the chairman's figures, interim Chairman John Reed said in a memo to members last week. The package demonstrates the control Grasso had in eight years at the helm of the world's biggest stock exchange.

"It certainly raises questions about Mr. Grasso's earlier comments that the board made all compensation decisions," said California State Teachers' Retirement System CEO Jack Ehnes.

Johnston made about $23 million in salary and bonuses from 1998 to 2002 at the NYSE. He got another $1.6 million in salary in 1996 and 1997. The exchange did not disclose his bonuses for those years.

His lump-sum pension benefit at year-end is estimated at $6.9 million, according to NYSE documents. That doesn't include the $6 million farewell payment that Grasso approved in Johnston's 2001 employment agreement.

Johnston declined to comment for this story, as did NYSE spokes-man Ray Pellecchia.