NEW YORK (Reuters) - Bermuda-domiciled Lazard Ltd. reported a fourth-quarter loss yesterday, hurt by compensation expenses stemming from the death of its chief executive, legendary Wall Street dealmaker Bruce Wasserstein.

The New York-based investment bank saw charges of $147 million triggered by Wasserstein's death in October and changes in compensation policies.

Those charges sent Lazard to a fourth-quarter loss of $142.3 million, or $1.64 a share.

Stripping out one-time compensation charges, the firm posted a loss of 46 cents a share. Analysts on average forecast a profit of 50 cents, according to Thomson Reuters I/B/E/S.

Revenue rose 27 percent to $517 million.

"The basic revenue move was indicative of a business that had a very good, healthy period," said Michael Holland, chairman of Holland & Co in New York. "It is a time when they can have these changes in compensation and provide for Bruce Wasserstein's departure and still be very healthy at the end of it."

Lazard saw continued strength in its restructuring business, where operating revenue rose to $103.4 million from $47.1 million a year earlier. The restructuring business posted record revenue in 2009 as companies sought advice in the aftermath of the financial crisis.

"We see restructuring activity being at a level where it is going to stay very active," Mike Castellano, Lazard's chief financial officer, told Reuters in an interview.

Lazard's financial advisory revenue, including restructuring, capital markets and M&A, rose 24 percent to $313.6 million. M&A revenue was down 12 percent.

Lazard shares were down $1.91, or 4.7 percent, $39.09 in early trading on the New York Stock Exchange, giving back most of the strong gains recorded on Tuesday.

A NEW YEAR

Lazard began 2009 under the uncertainty of the financial crisis, which led to the demise of larger investment banks and shook the industry.

As markets recovered, Lazard was jolted in October by Wasserstein's death.

Lazard's board appointed Kenneth Jacobs, a longtime veteran of the company, as its new CEO, a move that came with minor management changes and some new hires of old hands.

Felix Rohatyn, who had a nearly 50-year career at Lazard as a partner and managing director, returned to the firm as a special adviser to Jacobs this week.

Castellano said the environment seems to be favoring Lazard's key businesses of restructuring and asset management, while there are signs of a rebound in M&A activity.

"We all feel a lot better going into 2010 than we did last year at this time going into 2009," he said.

Lazard used the fourth quarter to position itself for the future in terms of compensation, an area where it feels it has an advantage over larger rivals encumbered by regulators, he said.

Lazard's compensation expenses nearly tripled in the fourth quarter, to $615.5 million from $221.9 million a year earlier. The firm changed its compensation structure, increasing cash and deferred equity pay while eliminating deferred cash compensation.

Wasserstein's death triggered an expense of $86.5 million related to earlier stock awards. Lazard also saw a charge of $60.5 million related to other one-time compensation expenses.