Legg Mason [profile] CEO Mark Fetting took a 17 percent pay cut in the last fiscal year, according to company documents filed with the SEC. Citing disappointing financial performance, the board of the Baltimore-based asset manager set Fetting's total compensation at $4.9 million, down from $5.9 million in the previous fiscal year.

Almost all of this pay came in the form of year-end incentive awards. Fetting took home a $500,000 salary, a $2.4 million cash bonus, and $2 million in stock awards.

In the SEC filing, the board noted that Fetting has overseen some successes in the last year, such as Legg's "strong overall investment performance" and smooth rollout of new products. But it decided that the 17 percent decrease was "appropriate in light of the company's financial performance in the last fiscal year." The filing also notes that the board used Towers Watson as an independent compensation consultant to help determine Netting's pay.

Legg Mason had a tough fiscal year. The firm's revenues decreased by three percent and its net income dropped 13 percent. Shareholder return, a calculation that combines stock price and divident payments, was negative 22 percent. The company's stock is trading at around $25, down 19 percent since a year ago. It peaked at $138 in 2006.

But the most recent news for Legg mason has been good. Last month, the money manager agreed to buy back its shares from private equity firm KKR & Co., and last week MFWire reported that Fetting's team is shopping for smaller fund shops. And so far in 2012, Legg Mason's stock is slightly up. 

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