The online brokerage ETrade Financial Corp. has elevated its general counsel Karl A. Roessner to chief executive, as part of a larger restructuring of its executive management team.
His salary will be $850,000. Other compensation includes annual cash and equity bonuses exceeding $2.3 million and a one-time grant of restricted stock units worth $1 million, according toan 8-K the company filed with the Securities and Exchange Commission.
“While the ETrade Board applauds the foundational enhancements and significant regulatory progress made by the company over the past three years, our core brokerage growth has come under pressure,” said Rodger Lawson, the company’s executive chairman in a press release on Monday. “Accordingly, we are restructuring the company’s leadership, elevating Karl Roessner — a proven and embedded leader with deep company expertise — to chief executive officer.”
The management changes trail the company’s announcement in July that it is acquiring OptionsHouse, an online stock and options trading platform, for $725 million. That company’s CEO Michael Curcio was appointed chief brokerage officer at ETrade as part of the restructuring, which coincided with the closing of the acquisition.
Based in New York, Roessner , 48, has been at ETrade since May 2009 working as executive vice-president and general counsel. Previously, he had been a Clifford Chance partner in the mergers and acquisitions group since 2001, a firm he joined as an associate in 2000.
Roessner graduated from St. John’s University School of Law in 1992.
The prior CEO Paul T. Idzik, who had been CEO since 2013, is leaving the company. He was not immediately available for comment nor was Roessner.
ETrade rose to prominence in the 1990s as one of the first online brokerages, but has faced competition in recent years from Betterment, Wealthfront and other start ups which take passive investment strategies and buy up wide swaths of the market through cheap index funds — on the theory that it’s impossible to beat the market. ETrade offers a hybrid approach, which includes passive and active investment strategies that can cost more.
Its net income was down for the six months that ended June 30 to $286 million, from $332 million during the same period in 2015, according to its most recent quarterly report.
ETrade stock was at $27.20 on Tuesday morning, and had a one-year low of $19.61.
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