Young Receives $1.29-Million Lump-Sum Gibraltar Payment

Herbert J. Young, replaced recently as head of ailing Gibraltar Savings in Beverly Hills after more than 35 years with the firm, has received a lump-sum payment of $1.29 million, the company’s annual proxy statement shows.

Young’s retirement from Gibraltar Financial, the parent company, was announced early last month. Young, 56, had been chairman of the firm for 20 years and chief executive for the past 27.

The proxy, sent to shareholders in advance of the firm’s annual meeting May 20 at the Beverly Wilshire Hotel, shows that Young is also entitled to retirement payments of $344,000 a year and has received a company car--a Mercedes-Benz valued at $36,900.

Gibraltar had the worst year in its long history in 1987. The savings and loan company, whose roots go back more than 100 years in California, lost $131 million because of heavy losses in its commercial real estate lending operations.

Gibraltar, which has about $15 billion in assets, has created a committee to review its corporate policies, monitor asset dispositions and oversee shareholder litigation, the proxy said. Among those on the committee are James N. Thayer, who replaced Young as chief executive, and Houston I. Flournoy, a former member of the California Assembly, former state controller and Republican candidate for governor in 1974. Flournoy teaches at USC.

The proxy further indicates that senior executive Jerome Nussbaum, who was recently demoted, is leaving the company. Nussbaum could not be reached for comment.

When Young retired, it was announced that Nussbaum, 42, had been “reassigned” from president to executive vice president of Gibraltar Savings. But the proxy indicates that he will remain in his new post only until early next month, after which he will receive a lump-sum payment of $140,000. He will formally cease to be a company employee on April 28, 1989, the proxy said.

Young’s lump-sum payment of $1.29 million replaces his job contract, which was to pay him an annual salary of $430,000 through Jan. 24, 1991. “His contracts were honored exactly as they were written,” said Jay Janis, who replaced Young as chairman of the company.

Young, said to be “pursuing personal investments,” remains a member of Gibraltar’s board. He joined the firm in 1952 after his discharge from the Air Force.

“Considering his longevity there, I don’t feel (the pay package) is that unusual,” said Gerald S. Haims, an analyst for Seidler Amdec Securities in Los Angeles. “If the new people can turn this company around, what they paid to have him retire may be to the shareholders’ advantage in the long run.”

Gibraltar’s stock closed Tuesday at $3.625, off 12.5 cents and above its 52-week low of $3.25 a share. The 52-week high is $11 a share.

Thayer, the new chief executive, is to receive a contract that runs one year and pays him a base salary of $350,000, the proxy said. Thayer, 61, has never served as a savings and loan executive before, but he has been a Gibraltar director since 1976.

Janis, the new chairman, was chairman of the Federal Home Loan Bank Board in the Carter Administration.