Bending the Third Rail
Because We Should, We Can, We Do
Wednesday, March 14, 2007
New Century Financial Corp.
New Century Financial Corp., the second-largest subprime lender, said today it ran out of cash to pay back creditors who are demanding their money now. The Irvine, California-based company has lost 90 percent of its market value this year and stopped making new subprime loans, prompting speculation it will seek bankruptcy protection. New Century already has cut 300 jobs and its 7,000 remaining employees are waiting to see if the company will survive.

The last CEO, Robert Cole, jumped ship just 3 months ago.
Robert Cole, New Century Financial Corp.'s chairman will retire Dec. 31. His replacement is Fredric Forster, the company’s lead independent director. Forster has been a member of the Irvine, Calif.-based lender’s board since 1997 and became its lead independent director in September 2005.

I wonder what kind of retirement package he got for all his hard work.
"Building New Century with my two partners and co-founders, Brad Morrice and Ed Gotschall, has been one of the most gratifying experiences of my professional life," said Mr. Cole. "Now that there has been a smooth transition of the chief executive officer role to Brad, I plan to retire from my position as Chairman of the Board at the end of this year. I look forward to continuing to support Brad and his management team as they lead the company to new heights."

New heights indeed. Cole did okay for himself while guiding his ship toward the iceberg.

Robert K. Cole
Chief Executive Officer
New Century Financial Corporation

In 2005, Robert K. Cole raked in $3,321,060 in total compensation including stock option grants* from New Century Financial Corporation.

From previous years' stock option grants, the New Century Financial Corporation executive cashed out $12,757,558 in stock option exercises.

And Robert K. Cole has another $10,185,618 in unexercised stock options from previous years.

I wonder how many people like my cousin paid for this man's golden years.