Morgan Stanley’s John Mack gets 150% raise

Morgan Stanley Chairman John Mack, who has said Wall Street’s high pay packages show that the industry is out of touch with mainstream America, is receiving a 150% base salary increase to $2 million.

Mack, who declined to accept a bonus the last three years, received a base salary of $800,000 in 2009. In 2006, the last year he received a bonus, he was awarded restricted shares that were worth $36.2 million at the time.

The salary increase, which was revealed in a regulatory filing, was meant to pay Mack “in line with his new role” as chairman, Morgan Stanley said.

James Gorman succeeded Mack as chief executive of the firm Jan. 1, but Mack remains chairman and continues to meet with clients and regulators.

Wall Street firms have faced a public backlash for their compensation practices after they handed out billions of dollars in bonuses a year after U.S. taxpayers bailed out the banking industry.

Mack, during a speaking appearance in February, said: “I still don’t think the industry gets it” on pay.

“If we don’t do something, the government will do something” on pay, Mack said.

Even though Mack did not receive a bonus for 2009, Gorman received a compensation package that could total about $15 million. Morgan Stanley reported a loss for 2009 as it missed out on trading opportunities during the rebound from the financial crisis.

Its chief rival, Goldman Sachs Group Inc., which reported a record profit in 2009, gave CEO Lloyd Blankfein a compensation package that was worth $9.5 million.

That Mack received a raise of $1.2 million underscores how Wall Street sees pay differently from Main Street, said Cornelius Hurley, director of the Morin Center for Banking and Financial Law at Boston University.

“The proportions are just so out of scale with the value that these men and women add to the financial system that they can get away with things like this,” Hurley said.

Mack’s new salary goes into effect Tuesday. Morgan Stanley said Mack has not received a pay increase since he rejoined the firm in 2005.