Stifel gives CEO 23 percent pay hike to $7 million

Ronald Kruszewski, the chief executive of brokerage firm Stifel Financial Corp , received $6.99 million in cash and stock awards in 2012, according to the St. Louis-based company's annual proxy filing on Friday.

The 23 percent jump in pay from 2011 included $2.3 million in cash and the rest in stock awards. Kruszewski, whose base salary of $200,000 has not changed since he joined Stifel in 1997, owns $6.3 million of the company's shares and another $6.9 million of stock that has not yet vested.

Kruszewski, 54, was rewarded primarily for Stifel's "improved performance" over 2011, the firm's compensation committee wrote in the filing.

Stifel's net income in 2012 surged 65 percent to $138.6 million and revenue was up 14 percent.

The proxy did not mention that the company's share price was flat for the year, after falling 23 percent in 2011. Shares have grown at a compound annual rate of 7 percent over the past five years, it noted, compared with a 15 percent drop in an index of broker-dealer stocks.

In a speech to retail brokerage executives on Thursday, Kruszewski attacked a proposed rule from the Financial Industry Regulatory Authority that will require U.S. brokers to disclose to their clients full details of pay and recruiting bonuses they receive when they move to a new firm.

The rule raises privacy and anti-competitive issues, Kruszewski said, and can further damage sinking levels of trust and confidence that investors have in brokerage firms.

More than 60 percent of Stifel's revenue last year came from retail brokerage operations, but Kruszewski has been focusing on building the firm's capital markets and investment banking businesses through acquisitions. Stifel in February bought KBW Inc, a money-losing New York-based investment bank specializing in giving advice to small banks.

The climate for bank merger deals and capital-raising remains tepid, Kruszewski said in a brief interview on Thursday, but said Stifel is well-positioned to profit when the environment changes.

Shares of Stifel, up 0.5 percent this year, were down 1.5 percent at $31.63 in afternoon trading on The New York Stock Exchange.

(Reporting By Jed Horowitz; Editing by Bernard Orr)