Ex-Hartford CEO Ayer awarded compensation of $4.8 million through first 10 months of 2009

Ex-Hartford CEO received ‘09 compensation of $4.8M

BOSTON — Ramani Ayer received compensation valued at nearly $4.8 million in his final 10 months as chairman and CEO of Hartford Financial Services Group Inc., according to an Associated Press analysis of a regulatory filing.

Liam McGee, who took over when Ayer retired at the end of October, received $341,654 for leading the life insurance and financial services company over the final two months of 2009.

Ayer’s 2009 compensation for the last 10 months of his 12-year tenure as CEO was down nearly 35 percent from a full-year total of nearly $7.3 million in 2008.

His salary fell to $958,333 from $1.15 million, reflecting 10 months of service rather than a full year.

Ayer’s performance-based cash bonus last year was $1,025,859. Ayer got no such bonus in 2008, when insurers like Hartford and the financial services sector struggled amid sharply falling financial markets and a credit crunch.

Ayer’s compensation last year also included stock options and restricted stock valued at about $2.7 million on the day they were awarded. That total is down from the $6 million Ayer in 2008.

Ayer also received other compensation of $84,455 in 2009, including items such as a car allowance, financial planning, and company contributions to retirement accounts. That was down 37 percent from the previous year.

McGee, who holds the president title as well as serving as chairman and CEO, was awarded a $275,000 salary covering November and December. He was awarded $66,654 in other compensation, a total that included assistance to relocate from North Carolina to the Hartford, Conn., area, where Hartford Financial is based.

The Associated Press formula is designed to isolate the value the company’s board placed on the executive’s total compensation package during the last fiscal year. It includes salary, bonus, performance-related bonuses, perks, above-market returns on deferred compensation and the estimated value of stock options and awards granted during the year. The calculations don’t include changes in the present value of pension benefits, making the AP total different in most cases than the total reported by companies to the Securities and Exchange Commission.

Ayer announced plans last June to step down after more than 36 years with Hartford Financial. McGee, 55, came to Hartford from Bank of America Corp. where he had served as head of consumer banking. McGee left Bank of America after nearly 20 years there, as then-CEO Ken Lewis shuffled his management team under pressure from shareholders and the U.S. government in the wake of receiving $45 billion in federal bailout aid.

Hartford was also among the companies receiving money under the Troubled Asset Relief Program, which imposed restrictions on executive compensation at companies receiving the funds. On March 31, Hartford said it had bought back all the $3.4 billion of the company’s preferred shares that were issued to the Treasury Department in exchange for the bailout aid.

In February, Hartford reported a net loss of $887 million for full-year 2009, or $2.93 per share, compared with a net loss of $2.75 billion, or $8.99 per share, in 2008. In the final three months of last year, the company posted a profit of $557 million, or $1.19 per share, as its life and property-casualty businesses improved.