NEW YORK (Reuters) - E*Trade Financial Corp (ETFC.O), an online brokerage scrambling to rebuild after suffering subprime mortgage losses, said recently installed Chairman Donald Layton, 57, would also take on the post of chief executive.
Layton has named chairman on November 29 when hedge fund giant Citadel Investment Group led a group of investors that injected $2.6 billion into E*Trade. The brokerage, which also owns a large Internet banking business, had amassed a $3 billion asset-backed securities portfolio that incurred large losses.
These woes led to the ouster of E*Trade CEO Mitch Caplan at the end of November. He was succeeded on a temporary basis by Jarrett Lilien, who now will resume his previous roles as company president and chief operating officer.
“The E*Trade franchise has immense strength, perhaps best exemplified by the quick return of its customer volumes,” Layton said in a statement. “I also believe that its current financial issues can be effectively managed despite the tough environment.”
Layton requested that all of his 2008 and 2009 incentive compensation be in the form of equity. Nearly 90 percent of his total compensation will be composed of restricted stock and stock options, with no cash bonus, the company said.
E*Trade said Cathleen Raffaeli has been named its lead independent director.
Reporting by Joseph A. Giannone; editing by John Wallace