10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2019

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from              to             

001-32492

(Commission File Number)

LAZARD LTD

(Exact name of registrant as specified in its charter)

Bermuda	98-0437848
(State or Other Jurisdiction of Incorporation	(I.R.S. Employer Identification No.)
or Organization)

Clarendon House

2 Church Street

Hamilton HM11, Bermuda

(Address of principal executive offices)

Registrant’s telephone number: (441) 295-1422

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A Common Stock	LAZ	New York Stock Exchange

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐

Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files).    Yes  ☒    No  ☐

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If the Registrant is an emerging growth company, indicate by check mark if the Registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.   ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No   ☒

As of July 19, 2019, there were 129,766,091 shares of the Registrant’s Class A common stock outstanding (including 22,883,607 shares held by subsidiaries).

TABLE OF CONTENTS

When we use the terms “Lazard”, “we”, “us”, “our” and “the Company”, we mean Lazard Ltd, a company incorporated under the laws of Bermuda, and its subsidiaries, including Lazard Group LLC, a Delaware limited liability company (“Lazard Group”), that is the current holding company for our businesses. Lazard Ltd’s primary operating asset is its indirect ownership as of June 30, 2019 of all of the common membership interests in Lazard Group and its controlling interest in Lazard Group.

	Page
Part I. Financial Information
Item 1. Financial Statements (Unaudited)	1
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	42
Item 3. Quantitative and Qualitative Disclosures About Market Risk	69
Item 4. Controls and Procedures	69
Part II. Other Information
Item 1. Legal Proceedings	70
Item 1A. Risk Factors	70
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	70
Item 3. Defaults Upon Senior Securities	71
Item 4. Mine Safety Disclosures	71
Item 5. Other Information	71
Item 6. Exhibits	72
Signatures	75

i

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited)

	Page
Condensed Consolidated Statements of Financial Condition as of June 30, 2019 and December 31, 2018	2
Condensed Consolidated Statements of Operations for the three month and six month periods ended June 30, 2019 and 2018	4
Condensed Consolidated Statements of Comprehensive Income for the three month and six month periods ended June 30, 2019 and 2018	5
Condensed Consolidated Statements of Cash Flows for the six month periods ended June 30, 2019 and 2018	6
Condensed Consolidated Statements of Changes in Stockholders’ Equity for the three month and six month periods ended June 30, 2019 and 2018	7
Notes to Condensed Consolidated Financial Statements	11

1

LAZARD LTD

CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

JUNE 30, 2019 AND DECEMBER 31, 2018

(UNAUDITED)

(dollars in thousands, except for per share data)

	June 30,		December 31,
	2019		2018
ASSETS
Cash and cash equivalents	$	919,221	$	1,246,537
Deposits with banks and short-term investments		1,301,520		1,006,969
Cash deposited with clearing organizations and other segregated cash		39,761		38,379
Receivables (net of allowance for doubtful accounts of $33,535 and $40,164    at June 30, 2019 and December 31, 2018, respectively):
Fees		502,846		501,397
Customers and other		202,268		184,137
		705,114		685,534
Investments		575,424		575,148
Property (net of accumulated amortization and depreciation of $351,119 and $339,770    at June 30, 2019 and December 31, 2018, respectively)		206,456		212,946
Operating lease right-of-use assets		477,432		-
Goodwill and other intangible assets (net of accumulated amortization of $66,908 and    $65,949 at June 30, 2019 and December 31, 2018, respectively)		374,436		375,318
Deferred tax assets		589,076		597,776
Other assets		319,033		258,634
Total Assets	$	5,507,473	$	4,997,241

See notes to condensed consolidated financial statements.

2

LAZARD LTD

CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

JUNE 30, 2019 AND DECEMBER 31, 2018

(UNAUDITED)

(dollars in thousands, except for per share data)

	June 30,			December 31,
	2019			2018
LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities:
Deposits and other customer payables	$	1,480,684		$	1,154,207
Accrued compensation and benefits		331,636			585,484
Operating lease liabilities		555,324			-
Senior debt		1,678,131			1,434,260
Tax receivable agreement obligation		246,953			270,640
Deferred tax liabilities		2,717			5,571
Other liabilities		494,150			576,986
Total Liabilities		4,789,595			4,027,148
Commitments and contingencies
STOCKHOLDERS’ EQUITY
Preferred stock, par value $.01 per share; 15,000,000 shares authorized:
Series A - no shares issued and outstanding		-			-
Series B - no shares issued and outstanding		-			-
Common stock:
Class A, par value $.01 per share (500,000,000 shares authorized;    129,766,091 shares issued at June 30, 2019 and December 31, 2018,    including shares held by subsidiaries as indicated below)		1,298			1,298
Additional paid-in-capital		582,342			750,692
Retained earnings		1,179,901			1,195,563
Accumulated other comprehensive loss, net of tax		(271,984	)		(273,818	)
		1,491,557			1,673,735
Class A common stock held by subsidiaries, at cost (21,761,253 and 17,574,805    shares at June 30, 2019 and December 31, 2018, respectively)		(872,755	)		(756,884	)
Total Lazard Ltd Stockholders’ Equity		618,802			916,851
Noncontrolling interests		99,076			53,242
Total Stockholders’ Equity		717,878			970,093
Total Liabilities and Stockholders’ Equity	$	5,507,473		$	4,997,241

See notes to condensed consolidated financial statements.

3

LAZARD LTD

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE THREE MONTH AND SIX MONTH PERIODS ENDED JUNE 30, 2019 AND 2018

(UNAUDITED)

(dollars in thousands, except for per share data)

	Three Months Ended					Six Months Ended
	June 30,					June 30,
	2019		2018			2019		2018
REVENUE
Investment banking and other advisory fees	$	328,974	$	421,444		$	664,778	$	830,170
Asset management fees		296,581		335,891			589,019		673,987
Interest income		4,013		2,138			7,813		4,848
Other		21,233		12,055			50,869		30,728
Total revenue		650,801		771,528			1,312,479		1,539,733
Interest expense		20,111		13,590			38,115		27,097
Net revenue		630,690		757,938			1,274,364		1,512,636
OPERATING EXPENSES
Compensation and benefits		372,470		416,159			744,724		821,206
Occupancy and equipment		30,953		29,240			59,248		59,478
Marketing and business development		28,784		28,228			56,768		53,887
Technology and information services		38,825		32,527			70,880		65,779
Professional services		19,144		16,714			33,361		29,145
Fund administration and outsourced services		28,493		33,227			57,423		68,411
Amortization and other acquisition-related (benefits) costs		5,042		(8,483	)		8,512		(7,617	)
Other		5,294		10,386			22,100		36,579
Total operating expenses		529,005		557,998			1,053,016		1,126,868
OPERATING INCOME		101,685		199,940			221,348		385,768
Provision for income taxes		28,172		51,561			51,359		75,728
NET INCOME		73,513		148,379			169,989		310,040
LESS - NET INCOME ATTRIBUTABLE TO    NONCONTROLLING INTERESTS		7,736		1,416			7,170		3,385
NET INCOME ATTRIBUTABLE TO LAZARD LTD	$	65,777	$	146,963		$	162,819	$	306,655
ATTRIBUTABLE TO LAZARD LTD CLASS A       COMMON STOCKHOLDERS:
WEIGHTED AVERAGE SHARES OF COMMON STOCK      OUTSTANDING:
Basic		111,981,204		120,306,257			111,962,729		120,118,182
Diluted		116,175,349		130,249,054			118,497,717		131,195,725
NET INCOME PER SHARE OF COMMON STOCK:
Basic	$	0.57	$	1.22		$	1.44	$	2.55
Diluted	$	0.55	$	1.13		$	1.36	$	2.34

See notes to condensed consolidated financial statements.

4

LAZARD LTD

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

FOR THE THREE MONTH AND SIX MONTH PERIODS ENDED JUNE 30, 2019 AND 2018

(UNAUDITED)

(dollars in thousands)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2019			2018			2019			2018
NET INCOME	$	73,513		$	148,379		$	169,989		$	310,040
OTHER COMPREHENSIVE INCOME (LOSS), NET OF    TAX:
Currency translation adjustments		(7,053	)		(43,453	)		(3,273	)		(26,107	)
Employee benefit plans:
Actuarial gain (net of tax expense of $2,420    and $1,746 for the three months ended June 30, 2019    and 2018, respectively, and $2,720 and $404    for the six months ended June 30, 2019 and 2018,    respectively)		2,812			8,300			2,861			3,286
Adjustment for items reclassified to earnings (net of    tax expense of $174 and $468 for the three months    ended June 30, 2019 and 2018, respectively,    and $352 and $684 for the six months ended    June 30, 2019 and 2018, respectively)		1,113			777			2,245			1,839
OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX		(3,128	)		(34,376	)		1,833			(20,982	)
COMPREHENSIVE INCOME		70,385			114,003			171,822			289,058
LESS - COMPREHENSIVE INCOME ATTRIBUTABLE TO    NONCONTROLLING INTERESTS		7,734			1,415			7,169			3,384
COMPREHENSIVE INCOME ATTRIBUTABLE TO    LAZARD LTD	$	62,651		$	112,588		$	164,653		$	285,674

See notes to condensed consolidated financial statements.

5

LAZARD LTD

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE SIX MONTH PERIODS ENDED JUNE 30, 2019 AND 2018

(UNAUDITED)

(dollars in thousands)

	Six Months Ended
	June 30,
	2019			2018
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	169,989		$	310,040
Adjustments to reconcile net income to net cash provided by (used in)    operating activities:
Depreciation and amortization of property		16,247			16,676
Noncash lease expense		26,720			-
Amortization of deferred expenses and share-based incentive compensation		226,629			225,647
Amortization and other acquisition-related (benefits) costs		8,512			(7,617	)
Deferred tax provision		7,423			20,799
Loss on extinguishment of debt		6,505			-
(Increase) decrease in operating assets and increase (decrease) in    operating liabilities:
Receivables-net		(19,520	)		(154,430	)
Investments		7,228			(79,998	)
Other assets		(107,740	)		(131,314	)
Accrued compensation and benefits and other liabilities		(259,428	)		(135,027	)
Net cash provided by operating activities		82,565			64,776
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to property		(18,064	)		(32,043	)
Disposals of property		85			1,327
Net cash used in investing activities		(17,979	)		(30,716	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from:
Issuance of senior debt, net of expenses		491,875			-
Customer deposits, net		314,730			70,194
Contributions from noncontrolling interests		1,193			516
Payments for:
Senior debt		(255,746	)		-
Distributions to noncontrolling interests		(7,811	)		(5,060	)
Payments under tax receivable agreement		(23,687	)		(31,897	)
Purchase of Class A common stock		(351,712	)		(223,795	)
Class A common stock dividends		(155,324	)		(255,228	)
Settlement of share-based incentive compensation		(96,089	)		(109,218	)
Other financing activities		(4,697	)		(4,698	)
Net cash used in financing activities		(87,268	)		(559,186	)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS AND    RESTRICTED CASH		(8,701	)		(46,762	)
NET DECREASE IN CASH AND CASH EQUIVALENTS AND    RESTRICTED CASH		(31,383	)		(571,888	)
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH—January 1		2,291,885			2,454,806
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH—June 30	$	2,260,502		$	1,882,918
RECONCILIATION OF CASH AND CASH EQUIVALENTS AND RESTRICTED CASH    WITHIN THE CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL    CONDITION:
	June 30,			December 31,
	2019			2018
Cash and cash equivalents	$	919,221		$	1,246,537
Deposits with banks and short-term investments		1,301,520			1,006,969
Cash deposited with clearing organizations and other segregated cash		39,761			38,379
TOTAL CASH AND CASH EQUIVALENTS AND RESTRICTED CASH	$	2,260,502		$	2,291,885

See notes to condensed consolidated financial statements.

6

LAZARD LTD

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

FOR THE THREE MONTH PERIOD ENDED JUNE 30, 2018

(UNAUDITED)

(dollars in thousands)

					Additional						Accumulated Other Comprehensive			Class A Common Stock						Total Lazard Ltd						Total
	Common Stock				Paid-In-			Retained			Income (Loss),			Held By Subsidiaries						Stockholders’			Noncontrolling			Stockholders’
	Shares		$		Capital			Earnings			Net of Tax			Shares			$			Equity			Interests			Equity
Balance - April 1, 2018		129,766,091	$	1,298	$	619,430		$	1,005,548		$	(219,124	)		9,359,466		$	(410,591	)	$	996,561		$	59,620		$	1,056,181
Comprehensive income (loss):
Net income									146,963												146,963			1,416			148,379
Other comprehensive loss - net of tax												(34,375	)								(34,375	)		(1	)		(34,376	)
Amortization of share-based incentive    compensation						87,010															87,010						87,010
Dividend equivalents						5,221			(6,135	)											(914	)					(914	)
Class A common stock dividends    ($0.44 per share)									(52,844	)											(52,844	)					(52,844	)
Purchase of Class A common stock															1,485,240			(77,846	)		(77,846	)					(77,846	)
Delivery of Class A common stock in    connection with share-based incentive    compensation and related tax expense    of $1,362						(60,943	)								(1,124,811	)		51,406			(9,537	)					(9,537	)
Business acquisitions and related equity    transactions:
Class A common stock issuable    (including related amortization)						144															144						144
Dividend equivalents						1,151			(1,151	)											-						-
Distributions to noncontrolling interests, net																					-			(3,093	)		(3,093	)
Balance - June 30, 2018		129,766,091	$	1,298	$	652,013		$	1,092,381		$	(253,499	)		9,719,895		$	(437,031	)	$	1,055,162		$	57,942		$	1,113,104

See notes to condensed consolidated financial statements.

7

LAZARD LTD

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

FOR THE SIX MONTH PERIOD ENDED JUNE 30, 2018

(UNAUDITED)

(dollars in thousands)

					Additional						Accumulated Other Comprehensive			Class A Common Stock						Total Lazard Ltd						Total
	Common Stock				Paid-In-			Retained			Income (Loss),			Held By Subsidiaries						Stockholders’			Noncontrolling			Stockholders’
	Shares		$		Capital			Earnings			Net of Tax			Shares			$			Equity			Interests			Equity
Balance - January 1, 2018		129,766,091	$	1,298	$	788,140		$	1,080,413		$	(232,518	)		10,747,142		$	(437,530	)	$	1,199,803		$	59,102		$	1,258,905
Comprehensive income (loss):
Net income									306,655												306,655			3,385			310,040
Other comprehensive loss - net of tax												(20,981	)								(20,981	)		(1	)		(20,982	)
Amortization of share-based incentive    compensation						169,830															169,830						169,830
Dividend equivalents						33,627			(38,308	)											(4,681	)					(4,681	)
Class A common stock dividends    ($2.15 per share)									(255,228	)											(255,228	)					(255,228	)
Purchase of Class A common stock															4,147,526			(223,795	)		(223,795	)					(223,795	)
Delivery of Class A common stock in    connection with share-based incentive    compensation and related tax expense    of $7,512						(340,963	)								(5,172,915	)		224,233			(116,730	)					(116,730	)
Business acquisitions and related equity    transactions:
Delivery of Class A common stock						(61	)								(1,858	)		61			-						-
Class A common stock issuable    (including related amortization)						289															289						289
Dividend equivalents						1,151			(1,151	)											-						-
Distributions to noncontrolling interests, net																					-			(4,544	)		(4,544	)
Balance - June 30, 2018		129,766,091	$	1,298	$	652,013		$	1,092,381		$	(253,499	)		9,719,895		$	(437,031	)	$	1,055,162		$	57,942		$	1,113,104

See notes to condensed consolidated financial statements.

8

LAZARD LTD

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

FOR THE THREE MONTH PERIOD ENDED JUNE 30, 2019

(UNAUDITED)

(dollars in thousands)

					Additional						Accumulated Other Comprehensive			Class A Common Stock						Total Lazard Ltd						Total
	Common Stock				Paid-In-			Retained			Income (Loss),			Held By Subsidiaries						Stockholders’			Noncontrolling			Stockholders’
	Shares		$		Capital			Earnings			Net of Tax			Shares			$			Equity			Interests			Equity
Balance - April 1, 2019		129,766,091	$	1,298	$	535,926		$	1,171,754		$	(268,858	)		17,846,122		$	(738,899	)	$	701,221		$	70,151		$	771,372
Comprehensive income (loss):
Net income									65,777												65,777			7,736			73,513
Other comprehensive loss - net of tax												(3,126	)								(3,126	)		(2	)		(3,128	)
Amortization of share-based incentive    compensation						58,989															58,989			17,413			76,402
Dividend-equivalents						4,630			(5,574	)											(944	)		(687	)		(1,631	)
Class A common stock dividends    ($0.47 per share)									(51,922	)											(51,922	)					(51,922	)
Purchase of Class A common stock															4,537,055			(159,615	)		(159,615	)					(159,615	)
Delivery of Class A common stock in    connection with share-based incentive    compensation and related tax benefit    of $477						(30,714	)								(621,924	)		25,759			(4,955	)					(4,955	)
Business acquisitions and related equity    transactions:
Class A common stock issuable    (including related amortization)						13,377															13,377						13,377
Dividend equivalents						134			(134	)											-						-
Distributions to noncontrolling interests,    net																					-			(6,999	)		(6,999	)
Consolidation of VIEs																					-			11,464			11,464
Balance - June 30, 2019		129,766,091	$	1,298	$	582,342		$	1,179,901		$	(271,984	)		21,761,253		$	(872,755	)	$	618,802		$	99,076		$	717,878

See notes to condensed consolidated financial statements.

9

LAZARD LTD

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

FOR THE SIX MONTH PERIOD ENDED JUNE 30, 2019

(UNAUDITED)

(dollars in thousands)

					Additional						Accumulated Other Comprehensive			Class A Common Stock						Total Lazard Ltd						Total
	Common Stock				Paid-In-			Retained			Income (Loss),			Held By Subsidiaries						Stockholders’			Noncontrolling			Stockholders’
	Shares		$		Capital			Earnings			Net of Tax			Shares			$			Equity			Interests			Equity
Balance - January 1, 2019		129,766,091	$	1,298	$	750,692		$	1,195,563		$	(273,818	)		17,574,805		$	(756,884	)	$	916,851		$	53,242		$	970,093
Comprehensive income (loss):
Net income									162,819												162,819			7,170			169,989
Other comprehensive income (loss) - net of tax												1,834									1,834			(1	)		1,833
Amortization of share-based incentive    compensation						125,202															125,202			35,881			161,083
Dividend-equivalents						20,142			(22,761	)											(2,619	)		(2,062	)		(4,681	)
Class A common stock dividends    ($1.41 per share)									(155,324	)											(155,324	)					(155,324	)
Purchase of Class A common stock															9,715,003			(351,712	)		(351,712	)					(351,712	)
Delivery of Class A common stock in    connection with share-based incentive    compensation and related tax benefit    of $4,358						(327,572	)								(5,528,555	)		235,841			(91,731	)					(91,731	)
Business acquisitions and related equity    transactions:
Class A common stock issuable    (including related amortization)						13,482															13,482						13,482
Dividend equivalents						396			(396	)											-						-
Distributions to noncontrolling interests,    net																					-			(6,618	)		(6,618	)
Consolidation of VIEs																					-			11,464			11,464
Balance - June 30, 2019		129,766,091	$	1,298	$	582,342		$	1,179,901		$	(271,984	)		21,761,253		$	(872,755	)	$	618,802		$	99,076		$	717,878

See notes to condensed consolidated financial statements.

10

LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

1. ORGANIZATION AND BASIS OF PRESENTATION

Organization

Lazard Ltd, a Bermuda holding company, and its subsidiaries (collectively referred to as “Lazard Ltd”, “Lazard”, “we” or the “Company”), including Lazard Ltd’s indirect investment in Lazard Group LLC, a Delaware limited liability company (collectively referred to, together with its subsidiaries, as “Lazard Group”), is one of the world’s preeminent financial advisory and asset management firms and has long specialized in crafting solutions to the complex financial and strategic challenges of our clients. We serve a diverse set of clients around the world, including corporations, governments, institutions, partnerships and individuals.

Lazard Ltd indirectly held 100% of all outstanding Lazard Group common membership interests as of June 30, 2019 and December 31, 2018. Lazard Ltd, through its control of the managing members of Lazard Group, controls Lazard Group, which is governed by an Amended and Restated Operating Agreement dated as of February 4, 2019 (the “Operating Agreement”).

Lazard Ltd’s primary operating asset is its indirect ownership of the common membership interests of, and managing member interests in, Lazard Group, whose principal operating activities are included in two business segments:

• Financial Advisory, which offers corporate, partnership, institutional, government, sovereign and individual clients across the globe a wide array of financial advisory services regarding mergers and acquisitions (“M&A”), capital advisory, restructurings, shareholder advisory, sovereign advisory, capital raising and other strategic advisory, and

• Asset Management, which offers a broad range of global investment solutions and investment management services in equity and fixed income strategies, asset allocation strategies, alternative investments and private equity funds to corporations, public funds, sovereign entities, endowments and foundations, labor funds, financial intermediaries and private clients.

In addition, we record selected other activities in our Corporate segment, including management of cash, investments, deferred tax assets, outstanding indebtedness, certain contingent obligations, and assets and liabilities associated with Lazard Group’s Paris-based subsidiary Lazard Frères Banque SA (“LFB”).

Basis of Presentation

The accompanying condensed consolidated financial statements of Lazard Ltd have been prepared pursuant to the rules and regulations of the United States Securities and Exchange Commission (the “SEC”) regarding interim financial reporting. Accordingly, they do not include all of the information and notes required by accounting principles generally accepted in the United States of America (“U.S. GAAP”) for complete financial statements and should be read in conjunction with the audited consolidated financial statements and notes thereto included in Lazard Ltd’s Annual Report on Form 10-K for the year ended December 31, 2018. The accompanying December 31, 2018 unaudited condensed consolidated statement of financial condition data was derived from audited consolidated financial statements, but does not include all disclosures required by U.S. GAAP for annual financial statement purposes. The accompanying condensed consolidated financial statements reflect all adjustments which are, in the opinion of management, necessary for a fair presentation of the financial position, results of operations and cash flows for the interim periods presented.

Preparing financial statements requires management to make estimates and assumptions that affect the amounts that are reported in the financial statements and the accompanying disclosures. For example, discretionary compensation and benefits expense for interim periods is accrued based on the year-to-date amount of revenue earned, and an assumed annual ratio of compensation and benefits expense to revenue, with the applicable amounts adjusted for certain items. Although these estimates are based on management’s knowledge of current events and actions that Lazard may undertake in the future, actual results may differ materially from the estimates.

The consolidated results of operations for the three month and six month periods ended June 30, 2019 are not indicative of the results to be expected for any future interim or annual period.

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LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

The condensed consolidated financial statements include Lazard Ltd, Lazard Group and Lazard Group’s principal operating subsidiaries: Lazard Frères & Co. LLC (“LFNY”), a New York limited liability company, along with its subsidiaries, including Lazard Asset Management LLC and its subsidiaries (collectively referred to as “LAM”); the French limited liability companies Compagnie Financière Lazard Frères SAS (“CFLF”) along with its subsidiaries, LFB and Lazard Frères Gestion SAS (“LFG”), and Maison Lazard SAS and its subsidiaries; and Lazard & Co., Limited (“LCL”), through Lazard & Co., Holdings Limited (“LCH”), an English private limited company, together with their jointly owned affiliates and subsidiaries.

The Company’s policy is to consolidate entities in which it has a controlling financial interest. The Company consolidates:

• Voting interest entities (“VOEs”) where the Company holds a majority of the voting interest in such VOEs, and

• Variable interest entities (“VIEs”) where the Company is the primary beneficiary having the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance and the obligation to absorb losses of, or receive benefits from, the VIE that could be potentially significant to the VIE (see Note 21).

When the Company does not have a controlling interest in an entity, but exerts significant influence over such entity’s operating and financial decisions, the Company either (i) applies the equity method of accounting in which it records a proportionate share of the entity’s net earnings, or (ii) elects the option to measure at fair value. Intercompany transactions and balances have been eliminated.

Certain prior period amounts have been reclassified to conform to the current period presentation.

2. RECENT ACCOUNTING DEVELOPMENTS

Leases—In February 2016, the Financial Accounting Standards Board (the “FASB”) issued updated guidance for leases. The guidance requires a lessee to (i) recognize a right-of-use asset and a lease liability that is initially measured at the present value of the lease payments, in the condensed consolidated statement of financial condition, (ii) recognize a single lease cost, calculated so that the cost of the lease is allocated over the lease term on a straight-line basis and (iii) classify operating lease related cash payments within operating activities and finance lease related principal cash payments within financing activities (with interest included in interest paid) in the condensed consolidated statement of cash flows.

The Company adopted the new guidance on January 1, 2019 using the optional transition method, which allows such guidance to be applied initially at the adoption date with a cumulative-effect adjustment and without restating comparative periods. Lazard elected the package of practical expedients, which allows the carry-forward of the prior conclusions on lease definition, classification and initial direct costs related to the existing leases as of the adoption date.

Substantially all of the Company’s existing lease arrangements are operating leases. The adoption of the new guidance on January 1, 2019 resulted in a recognition of $502,000 of operating lease right-of-use assets (“ROU assets”) and $581,000 of operating lease liabilities in the Company’s condensed consolidated statements of financial condition.  The operating lease liabilities at January 1, 2019 reflect any remaining lease payments discounted using an incremental borrowing rate (on a collateralized basis) based on the remaining lease term (the “Discount”), as an implicit rate was not readily determinable for any of the Company’s existing operating leases.  The operating lease ROU assets are lower than the operating lease liabilities primarily because lease incentives reduce the ROU assets (see Note 9).

Improvements to Nonemployee Share-Based Payment Accounting—In June 2018, the FASB issued updated guidance to simplify the accounting for nonemployee share-based payment transactions. The new guidance generally requires equity-classified nonemployee share-based payment awards to be measured at the grant date, which is the date at which a grantor and grantee reach a mutual understanding of the key terms and conditions of a share-based payment award.  This update generally aligns the accounting for equity-classified share-based payment awards to nonemployees with the measurement date required for employees.  The Company adopted the new guidance on January 1, 2019 and its application did not have a material impact on the Company’s financial statements.

Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income—In February 2018, the FASB issued updated guidance on the tax effects of items in “accumulated other comprehensive income (loss), net of tax” (“AOCI”). Specifically, the new guidance will permit, but not require, a reclassification from AOCI to retained earnings for stranded tax effects resulting from the newly enacted federal corporate income tax rate under the Tax Cuts and Jobs Act of 2017. The amount of the reclassification would be the difference between the historical corporate income tax rate and the newly enacted 21% corporate income tax rate. The Company adopted the new guidance on January 1, 2019 without reclassifying any amounts from AOCI to retained earnings.  The application of the guidance did not have a material impact on the Company’s financial statements.

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LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

Financial Instruments—Credit Losses: Measurement of Credit Losses on Financial Instruments—In June 2016, the FASB issued new guidance regarding the measurement of credit losses on financial instruments. The new guidance replaces the incurred loss impairment methodology in the current guidance with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to determine credit loss estimates. The new guidance is effective for annual and interim periods beginning after December 15, 2019 with early adoption permitted for fiscal years beginning after December 15, 2018.  The new guidance is required to be applied using a modified retrospective approach. The Company is currently evaluating the new guidance.

Intangibles—Goodwill and Other: Simplifying the Test for Goodwill Impairment—In January 2017, the FASB issued updated guidance which eliminated Step 2 from the goodwill impairment test. Step 2 is the process of measuring a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. The new guidance requires entities to measure a goodwill impairment loss as the amount by which a reporting unit’s carrying value exceeds its fair value, limited to the carrying amount of goodwill. The FASB also eliminated the requirements for entities that have reporting units with zero or negative carrying amounts to perform a qualitative assessment for the goodwill impairment test. Instead, those entities would be required to disclose the amount of goodwill allocated to each reporting unit with a zero or negative carrying amount. The new guidance is effective for interim or annual goodwill impairment tests performed in fiscal years beginning after December 15, 2019, with early adoption permitted. The Company is currently evaluating the new guidance.

Intangibles—Internal-Use Software: Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract—In August 2018, the FASB issued updated guidance on the accounting for implementation costs incurred in a cloud computing arrangement. The new guidance requires the capitalization of the implementation costs incurred in a cloud computing arrangement to be aligned with the requirements for capitalizing costs incurred to develop or obtain internal-use software. The new guidance is effective for annual and interim reporting periods beginning after December 15, 2019, with early adoption permitted. Upon adoption, the Company may elect to apply the new guidance on either a prospective or retrospective basis. The Company is currently evaluating the new guidance.

Related Party Guidance for Variable Interest Entities—In October 2018, the FASB issued updated guidance that requires consideration of indirect interest held through related parties under common control for determining whether fees paid to decision makers and service providers are variable interests. The new guidance is effective for fiscal years and interim periods beginning after December 15, 2019, with early adoption permitted. The amendments are required to be applied retrospectively with a cumulative-effect adjustment. The Company is currently evaluating the new guidance.

Fair Value Measurement: Changes to the Disclosure Requirements for Fair Value Measurement—In August 2018, the FASB issued updated guidance which modifies the disclosure requirements on fair value measurement. The updated guidance eliminates or modifies various required disclosures under the current guidance and includes additional requirements. The new guidance is effective for annual and interim reporting periods beginning after December 15, 2019, with early adoption permitted.  With certain exceptions, the guidance is required to be applied retrospectively. The Company is currently evaluating the new guidance.

Compensation–Retirement Benefits: Changes to the Disclosure Requirements for Defined Benefit Plans—In August 2018, the FASB issued updated guidance which modifies the disclosure requirements regarding defined benefit plans and other postretirement plans. The updated guidance eliminates or clarifies certain currently required disclosures and includes additional requirements. The new guidance is effective for annual and interim reporting periods beginning after December 15, 2020, with early adoption permitted. A retrospective application is required. The Company is currently evaluating the new guidance.

3. REVENUE RECOGNITION

Investment Banking and Other Advisory Fees—Fees for Financial Advisory services are recorded when: (i) a contract with a client has been identified, (ii) the performance obligations in the contract have been identified, (iii) the fee or other transaction price has been determined, (iv) the fee or other transaction price has been allocated to each performance obligation in the contract, and (v) the Company has satisfied the applicable performance obligation. The expenses that are directly related to such transactions are recorded as incurred and presented within operating expenses when the Company is primarily responsible for fulfilling the promise of the arrangement. Revenues associated with the reimbursement of such expenses are recorded when the Company is contractually entitled to reimbursement and presented within investment banking and other advisory fees.

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LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

Asset Management Fees—Fees for Asset Management services are primarily comprised of management fees and incentive fees. Management fees are derived from fees for investment management and other services provided to clients. Revenue is recorded in accordance with the same five criteria as Financial Advisory fees, which generally results in management fees being recorded on a daily, monthly or quarterly basis, primarily based on a percentage of client assets managed.  Fees vary with the type of assets managed, with higher fees earned on equity assets, alternative investment (such as hedge fund) and private equity funds, and lower fees earned on fixed income and money market products.  Expenses that are directly related to the sale or distribution of fund interests are recorded as incurred and presented within operating expenses when the Company is primarily responsible for fulfilling the promise of the arrangement.  Revenues associated with the reimbursement of such expenses are recorded when the Company is contractually entitled to reimbursement and presented within asset management fees.

In addition, the Company earns performance-based incentive fees on various investment products, including traditional products and alternative investment funds such as hedge funds and private equity funds.  

For hedge funds, incentive fees are calculated based on a specific percentage of a fund’s net appreciation, in some cases in excess of established benchmarks or thresholds.  The Company records incentive fees on traditional products and hedge funds when a significant reversal in the amount of the cumulative revenue to be recognized is not probable, which is typically at the end of the relevant performance measurement period. The incentive fee measurement period is generally an annual period (unless an account is terminated during the year).  The incentive fees received at the end of the measurement period are not subject to reversal or payback.  Incentive fees on hedge funds generally are subject to loss carryforward provisions in which losses incurred by the hedge funds in any year are applied against certain gains realized by the hedge funds in future periods before any incentive fees can be earned.

For private equity funds, incentive fees may be earned in the form of a “carried interest” if profits arising from realized investments exceed a specified threshold. Typically, such carried interest is ultimately calculated on a whole-fund basis and, therefore, clawback of carried interests during the life of the fund can occur. As a result, the Company records incentive fees earned on our private equity funds when a significant reversal in the amount of the cumulative revenue to be recognized is not probable, which is typically at the end of the relevant performance period.

Receivables relating to asset management and incentive fees are reported in “fees receivable” on the consolidated statements of financial condition.

The Company disaggregates revenue based on its business segment results and believes that the following information provides a reasonable representation of how performance obligations relate to the nature, amount, timing and uncertainty of revenue and cash flows:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2019		2018		2019		2018
Net Revenue:
Financial Advisory (a)	$	329,612	$	422,089	$	667,982	$	831,210
Asset Management:
Management Fees and Other (b)	$	310,316	$	340,160	$	611,569	$	688,844
Incentive Fees (c)		5,275		12,428		5,855		18,027
Total Asset Management	$	315,591	$	352,588	$	617,424	$	706,871

(a) Financial Advisory is comprised of M&A Advisory, Capital Advisory, Capital Raising, Restructuring, Shareholder Advisory, Sovereign Advisory, and other strategic advisory work for clients. The benefits of these advisory services are generally transferred to the Company’s clients over time, and consideration for these advisory services typically includes transaction completion, transaction announcement and retainer fees. Retainer fees are generally fixed and recognized over the period in which the advisory services are performed. However, transaction announcement and transaction completion fees are variable and subject to constraints, and they are typically not recognized until there is an announcement date or a completion date, respectively, due to the uncertainty associated with those events. Therefore, in any given period, advisory fees recognized for certain transactions will relate to services performed in prior periods. The advisory fees that may be unrecognized as of the end of a reporting period, primarily comprised of fees associated with transaction announcements and transaction completions, generally remain unrecognized due to the uncertainty associated with those events.

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LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

(b) Management fees and other is primarily comprised of management services. The benefits of these management services are transferred to the Company’s clients over time. Consideration for these management services generally includes management fees, which are based on assets under management and recognized over the period in which the management services are performed. The selling or distribution of fund interests is a separate performance obligation within management fees and other, and the benefits of such services are transferred to the Company’s clients at the point in time that such fund interests are sold or distributed.

(c) Incentive fees is primarily comprised of management services. The benefits of these management services are transferred to the Company’s clients over time. Consideration for these management services is generally variable and includes performance or incentive fees. The fees allocated to these management services that are unrecognized as of the end of the reporting period are generally amounts that are subject to constraints due to the uncertainty associated with performance targets and clawbacks.

In addition to the above, contracts with clients include trade-based commission income, which is recognized at the point in time of execution and presented within other revenue. Such income may be earned by providing trade facilitation, execution, clearance and settlement, custody, and trade administration services to clients.

With regard to the disclosure requirement for remaining performance obligations, the Company elected the practical expedients permitted in the guidance to (i) exclude contracts with a duration of one year or less; and (ii) exclude variable consideration, such as transaction completion and transaction announcement fees, that is allocated entirely to unsatisfied performance obligations. Excluded variable consideration typically relates to contracts with a duration of one year or less, and is generally constrained due to uncertainties. Therefore, when applying the practical expedients, amounts related to remaining performance obligations are not material to the Company’s financial statements.

4. RECEIVABLES

The Company’s receivables represent fee receivables, amounts due from customers and other receivables.

Receivables are stated net of an estimated allowance for doubtful accounts, for past due amounts and for specific accounts deemed uncollectible, which may include situations where a fee is in dispute.

Activity in the allowance for doubtful accounts for the three month and six month periods ended June 30, 2019 and 2018 was as follows:

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2019			2018			2019			2018
Beginning Balance	$	43,258		$	38,557		$	40,164		$	23,746
Bad debt expense, net of recoveries		(9,380	)		666			(5,551	)		16,618
Charge-offs, foreign currency translation and other    adjustments		(343	)		(4,267	)		(1,078	)		(5,408	)
Ending Balance	$	33,535		$	34,956		$	33,535		$	34,956

Bad debt expense, net of recoveries is included in “operating expenses—other” on the condensed consolidated statements of operations.

At June 30, 2019 and December 31, 2018, the Company had receivables past due or deemed uncollectible of $45,516 and $42,309, respectively.

Of the Company’s fee receivables at June 30, 2019 and December 31, 2018, $79,426 and $90,966, respectively, represented interest-bearing financing receivables. Based upon our historical loss experience, the credit quality of the counterparties, and the lack of past due or uncollectible amounts, there was no allowance for doubtful accounts required at those dates related to such receivables.

The aggregate carrying amount of our non-interest bearing receivables of $625,688 and $594,568 at June 30, 2019 and December 31, 2018, respectively, approximates fair value.

15

LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

5. INVESTMENTS

The Company’s investments and securities sold, not yet purchased, consist of the following at June 30, 2019 and December 31, 2018:

	June 30,		December 31,
	2019		2018
Interest-bearing deposits	$	511	$	510
Debt		124,838		202,874
Equities		37,858		32,261
Funds:
Alternative investments (a)		42,000		17,752
Debt (a)		104,756		90,320
Equity (a)		223,593		175,088
Private equity		41,868		56,343
		412,217		339,503
Total investments		575,424		575,148
Less:
Interest-bearing deposits		511		510
Investments, at fair value	$	574,913	$	574,638
Securities sold, not yet purchased, at fair value    (included in “other liabilities”)	$	2,261	$	3,929

(a) Interests in alternative investment funds, debt funds and equity funds include investments with fair values of $9,665, $75,364 and $172,711, respectively, at June 30, 2019 and $9,741, $60,081 and $132,038, respectively, at December 31, 2018, held in order to satisfy the Company’s liability upon vesting of previously granted Lazard Fund Interests (“LFI”) and other similar deferred compensation arrangements. LFI represent grants by the Company to eligible employees of actual or notional interests in a number of Lazard-managed funds, subject to service-based vesting conditions (see Notes 7 and 14).

Interest-bearing deposits have original maturities of greater than three months but equal to or less than one year and are carried at cost that approximates fair value due to their short-term maturities.

Debt primarily consists of U.S. Treasury securities with original maturities of greater than three months and less than one year.

Equities primarily consist of seed investments invested in marketable equity securities of large-, mid- and small-cap domestic, international and global companies held within separately managed accounts related to our Asset Management business.

Alternative investment funds primarily consist of interests in various Lazard-managed hedge funds, funds of funds and mutual funds. Such amounts primarily consist of seed investments in funds related to our Asset Management business and amounts related to LFI discussed above.

Debt funds primarily consist of seed investments in funds related to our Asset Management business that invest in debt securities, amounts related to LFI discussed above and an investment in a Lazard-managed debt fund.

Equity funds primarily consist of seed investments in funds related to our Asset Management business that invest in equity securities, and amounts related to LFI discussed above.

Private equity investments include those owned by Lazard and those consolidated but not owned by Lazard. Private equity investments owned by Lazard are primarily comprised of investments in private equity funds. Such investments primarily include (i) Edgewater Growth Capital Partners III, L.P. (“EGCP III”), a fund primarily making equity and buyout investments in middle market companies and (ii) a fund targeting significant noncontrolling-stake investments in established private companies.

16

LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

Private equity investments consolidated but not owned by Lazard relate to the economic interests that are owned by the management team and other investors in the Edgewater Funds (“Edgewater”).

During the three month and six month periods ended June 30, 2019 and 2018, the Company reported in “revenue-other” on its condensed consolidated statements of operations net unrealized investment gains and losses pertaining to “equity securities and trading debt securities” still held as of the reporting date as follows:

	Three Months Ended					Six Months Ended
	June 30,					June 30,
	2019		2018			2019		2018
Net unrealized investment gains (losses)	$	7,229	$	(5,864	)	$	27,152	$	(15,155	)

6. FAIR VALUE MEASUREMENTS

Fair Value Hierarchy of Investments and Certain Other Assets and Liabilities—Lazard categorizes its investments and certain other assets and liabilities recorded at fair value into a three-level fair value hierarchy as follows:

Level 1. Assets and liabilities whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market that Lazard has the ability to access.

Level 2. Assets and liabilities whose values are based on (i) quoted prices for similar assets or liabilities in an active market, or quoted prices for identical or similar assets or liabilities in non-active markets, or (ii) inputs other than quoted prices that are directly observable or derived principally from, or corroborated by, market data.

Level 3. Assets and liabilities whose values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. These inputs reflect our own assumptions about the assumptions a market participant would use in pricing the asset or liability. Items included in Level 3 include securities or other financial assets whose trading volume and level of activity have significantly decreased when compared with normal market activity and there is no longer sufficient frequency or volume to provide pricing information on an ongoing basis.

The fair value of debt is classified as Level 1 when the fair values are based on unadjusted quoted prices in active markets.

The fair value of equities is classified as Level 1 or Level 3 as follows: marketable equity securities are classified as Level 1 and are valued based on the last trade price on the primary exchange for that security as provided by external pricing services; equity securities in private companies are generally classified as Level 3.

The fair value of investments in alternative investment funds, debt funds and equity funds is classified as Level 1 when the fair values are primarily based on the publicly reported closing price for the fund.

The fair value of investments in private equity funds is classified as Level 3 for certain investments that are valued based on the potential transaction value as of June 30, 2019.

The fair value of securities sold, not yet purchased, is classified as Level 1 when the fair values are based on unadjusted quoted prices in active markets.

The fair value of the contingent consideration liability is classified as Level 3 and the fair value of the liability is remeasured at each reporting period. The inputs used to derive the fair value of the contingent consideration include the application of probabilities when assessing certain performance thresholds for the relevant periods. Any change in the fair value is recognized in “amortization and other acquisition-related (benefits) costs” in the condensed consolidated statement of operations. Our business acquisitions may involve the potential payment of contingent consideration upon the achievement of certain performance thresholds. The contingent consideration liability is initially recorded at fair value of the contingent payments on the acquisition date and is included in “other liabilities” on the condensed consolidated statements of financial condition. See Note 12.

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LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

The fair value of derivatives entered into by the Company is classified as Level 2 and is based on the values of the related underlying assets, indices or reference rates as follows: the fair value of forward foreign currency exchange rate contracts is a function of the spot rate and the interest rate differential of the two currencies from the trade date to settlement date; the fair value of total return swaps is based on the change in fair value of the related underlying equity security, financial instrument or index and a specified notional holding; the fair value of interest rate swaps is based on the interest rate yield curve; and the fair value of derivative liabilities related to LFI and other similar deferred compensation arrangements is based on the value of the underlying investments, adjusted for forfeitures. See Note 7.

Investments Measured at Net Asset Value (“NAV”)—As a practical expedient, the Company uses NAV or its equivalent to measure the fair value of certain investments. NAV is primarily determined based on information provided by external fund administrators. The Company’s investments valued at NAV as a practical expedient in (i) alternative investment funds, debt funds and equity funds are redeemable in the near term, and (ii) private equity funds are not redeemable in the near term as a result of redemption restrictions.

The following tables present, as of June 30, 2019 and December 31, 2018, the classification of (i) investments and certain other assets and liabilities measured at fair value on a recurring basis within the fair value hierarchy and (ii) investments measured at NAV or its equivalent as a practical expedient:

	June 30, 2019
	Level 1		Level 2		Level 3		NAV		Total
Assets:
Investments:
Debt	$	124,838	$	-	$	-	$	-	$	124,838
Equities		36,252		-		1,606		-		37,858
Funds:
Alternative investments		17,196		-		-		24,804		42,000
Debt		104,749		-		-		7		104,756
Equity		223,554		-		-		39		223,593
Private equity		-		-		2,131		39,737		41,868
Derivatives		-		2,180		-		-		2,180
Total	$	506,589	$	2,180	$	3,737	$	64,587	$	577,093
Liabilities:
Securities sold, not yet purchased	$	2,261	$	-	$	-	$	-	$	2,261
Contingent consideration liability		-		-		4,386		-		4,386
Derivatives		-		235,504		-		-		235,504
Total	$	2,261	$	235,504	$	4,386	$	-	$	242,151

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LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

	December 31, 2018
	Level 1		Level 2		Level 3		NAV		Total
Assets:
Investments:
Debt	$	202,874	$	-	$	-	$	-	$	202,874
Equities		30,639		-		1,622		-		32,261
Funds:
Alternative investments		16,863		-		-		889		17,752
Debt		90,313		-		-		7		90,320
Equity		175,054		-		-		34		175,088
Private equity		-		-		-		56,343		56,343
Derivatives		-		11,967		-		-		11,967
Total	$	515,743	$	11,967	$	1,622	$	57,273	$	586,605
Liabilities:
Securities sold, not yet purchased	$	3,929	$	-	$	-	$	-	$	3,929
Contingent consideration liability		-		-		10,009		-		10,009
Derivatives		-		188,962		-		-		188,962
Total	$	3,929	$	188,962	$	10,009	$	-	$	202,900

The following tables provide a summary of changes in fair value of the Company’s Level 3 assets and liabilities for the three month and six month periods ended June 30, 2019 and 2018:

	Three Months Ended June 30, 2019
	Beginning Balance		Net Unrealized/ Realized Gains/Losses Included In Earnings (a)			Purchases/ Acquisitions/ Transfers (b)		Sales/ Dispositions/ Settlements			Foreign Currency Translation Adjustments		Ending Balance
Assets:
Investments:
Equities	$	1,618	$	(12	)	$	-	$	-		$	-	$	1,606
Private equity funds		-		-			2,131		-			-		2,131
Total Level 3 Assets	$	1,618	$	(12	)	$	2,131	$	-		$	-	$	3,737
Liabilities:
Contingent consideration liability	$	13,048	$	4,611		$	-	$	(13,273	)	$	-	$	4,386
Total Level 3 Liabilities	$	13,048	$	4,611		$	-	$	(13,273	)	$	-	$	4,386

19

LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

	Six Months Ended June 30, 2019
	Beginning Balance		Net Unrealized/ Realized Gains/Losses Included In Earnings (a)			Purchases/ Acquisitions/ Transfers (b)		Sales/ Dispositions/ Settlements			Foreign Currency Translation Adjustments			Ending Balance
Assets:
Investments:
Equities	$	1,622	$	(14	)	$	-	$	-		$	(2	)	$	1,606
Private equity funds		-		-			2,131		-			-			2,131
Total Level 3 Assets	$	1,622	$	(14	)	$	2,131	$	-		$	(2	)	$	3,737
Liabilities:
Contingent consideration liability	$	10,009	$	7,650		$	-	$	(13,273	)	$	-		$	4,386
Total Level 3 Liabilities	$	10,009	$	7,650		$	-	$	(13,273	)	$	-		$	4,386

	Three Months Ended June 30, 2018
	Beginning Balance		Net Unrealized/ Realized Gains/Losses Included In Earnings (a)			Purchases/ Acquisitions		Sales/ Dispositions/ Settlements		Foreign Currency Translation Adjustments			Ending Balance
Assets:
Investments:
Equities	$	1,599	$	62		$	-	$	-	$	(32	)	$	1,629
Total Level 3 Assets	$	1,599	$	62		$	-	$	-	$	(32	)	$	1,629
Liabilities:
Contingent consideration liability	$	28,974	$	(9,346	)	$	-	$	-	$	-		$	19,628
Total Level 3 Liabilities	$	28,974	$	(9,346	)	$	-	$	-	$	-		$	19,628

	Six Months Ended June 30, 2018
	Beginning Balance		Net Unrealized/ Realized Gains/Losses Included In Earnings (a)			Purchases/ Acquisitions		Sales/ Dispositions/ Settlements		Foreign Currency Translation Adjustments			Ending Balance
Assets:
Investments:
Equities	$	1,592	$	61		$	1	$	-	$	(25	)	$	1,629
Total Level 3 Assets	$	1,592	$	61		$	1	$	-	$	(25	)	$	1,629
Liabilities:
Contingent consideration liability	$	28,941	$	(9,313	)	$	-	$	-	$	-		$	19,628
Total Level 3 Liabilities	$	28,941	$	(9,313	)	$	-	$	-	$	-		$	19,628

(a) Earnings recorded in “other revenue” for investments in equities for the three month and six month periods ended June 30, 2019 and the three month and six month periods ended June 30, 2018 include net unrealized gains (losses) of $(12), $(14), $62 and $61, respectively. Earnings recorded in “amortization and other acquisition-related (benefits) costs” for the contingent consideration liability for the three month and six month periods ended June 30, 2019 and the three month and six month periods ended June 30, 2018 include unrealized (gains) losses of $4,611, $7,650, $(9,346) and $(9,313), respectively.

(b) Certain investments that were valued at NAV as of December 31, 2018 were transferred to Level 3 during the three month and six month periods ended June 30, 2019 as these investments are valued based on a potential transaction value that differs from NAV.

20

LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

There were no transfers between any of the Level 1, 2 and 3 categories in the fair value measurement hierarchy during the three month and six month periods ended June 30, 2019 and 2018.

The following tables present, at June 30, 2019 and December 31, 2018, certain investments that are valued using NAV or its equivalent as a practical expedient in determining fair value:

June 30, 2019

Estimated Liquidation Period of Investments Not Redeemable

Investments Redeemable

Fair Value

Unfunded Commitments

% of Fair Value Not Redeemable

% Next 5 Years

% 5-10 Years

% Thereafter

Redemption Frequency

Redemption Notice Period

Alternative investment funds:

Hedge funds

$

24,183

$

-

NA

NA

NA

NA

(a)

30-60 days

Funds of funds

24

-

NA

NA

NA

NA

(b)

>90 days

Other

597

-

NA

NA

NA

NA

(c)

<30-30 days

Debt funds

7

-

NA

NA

NA

NA

(d)

<30 days

Equity funds

39

-

NA

NA

NA

NA

(e)

<30-90 days

Private equity funds:

Equity growth

39,737

8,264

(f)

100

%

19

%

14

%

67

%

NA

NA

Total

$

64,587

$

8,264

(a) monthly (100%)

(b) quarterly (100%)

(c) daily (6%) and monthly (94%)

(d) daily (100%)

(e) daily (23%), monthly (72%) and annually (5%)

(f) Unfunded commitments to private equity investments consolidated but not owned by Lazard of $13,400 are excluded. Such commitments are required to be funded by capital contributions from noncontrolling interest holders.

December 31, 2018

Estimated Liquidation Period of Investments Not Redeemable

Investments Redeemable

Fair Value

Unfunded Commitments

% of Fair Value Not Redeemable

% Next 5 Years

% 5-10 Years

% Thereafter

Redemption Frequency

Redemption Notice Period

Alternative investment funds:

Hedge funds

$

299

$

-

NA

NA

NA

NA

(a)

30-60 days

Funds of funds

23

-

NA

NA

NA

NA

(b)

>90 days

Other

567

-

NA

NA

NA

NA

(c)

<30-30 days

Debt funds

7

-

NA

NA

NA

NA

(d)

<30 days

Equity funds

34

-

NA

NA

NA

NA

(e)

<30-90 days

Private equity funds:

Equity growth

56,343

8,338

(f)

100

%

14

%

34

%

52

%

NA

NA

Total

$

57,273

$

8,338

(a) monthly (100%)   

(b) quarterly (100%)

(c) daily (6%) and monthly (94%)

(d) daily (100%)

(e) daily (25%), monthly (70%) and annually (5%)

(f) Unfunded commitments to private equity investments consolidated but not owned by Lazard of $14,437 are excluded. Such commitments are required to be funded by capital contributions from noncontrolling interest holders.

21

LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

Investment Capital Funding Commitments—At June 30, 2019, the Company’s maximum unfunded commitments for capital contributions to investment funds primarily arose from commitments to EGCP III, which amounted to $7,602. The investment period for EGCP III ended on October 12, 2016, after which point the Company’s obligation to fund capital contributions for new investments in EGCP III expired. The Company remains obligated until October 12, 2023 (or any earlier liquidation of EGCP III) to make capital contributions necessary to fund follow-on investments and to pay for fund expenses.

7. DERIVATIVES

The Company enters into forward foreign currency exchange rate contracts, interest rate swaps, interest rate futures, total return swap contracts on various equity and debt indices and other derivative contracts to economically hedge exposures to fluctuations in currency exchange rates, interest rates and equity and debt prices. The Company reports its derivative instruments separately as assets and liabilities unless a legal right of set-off exists under a master netting agreement enforceable by law. The Company’s derivative instruments are recorded at their fair value, and are included in “other assets” and “other liabilities” on the condensed consolidated statements of financial condition. Gains and losses on the Company’s derivative instruments are generally included in “interest income” and “interest expense”, respectively, or “revenue-other”, depending on the nature of the underlying item, in the condensed consolidated statements of operations.

In addition to the derivative instruments described above, the Company records derivative liabilities relating to its obligations pertaining to LFI and other similar deferred compensation arrangements, the fair value of which is based on the value of the underlying investments, adjusted for estimated forfeitures, and is included in “accrued compensation and benefits” in the condensed consolidated statements of financial condition. Changes in the fair value of the derivative liabilities are included in “compensation and benefits” in the condensed consolidated statements of operations, the impact of which equally offsets the changes in the fair value of investments which are currently expected to be delivered upon settlement of LFI and other similar deferred compensation arrangements, which are reported in “revenue-other” in the condensed consolidated statements of operations.

The table below presents the fair value of the Company’s derivative instruments reported within “other assets” and “other liabilities” and the fair value of the Company’s derivative liabilities relating to its obligations pertaining to LFI and other similar deferred compensation arrangements reported within “accrued compensation and benefits” (see Note 13) on the accompanying condensed consolidated statements of financial condition as of June 30, 2019 and December 31, 2018:

	June 30,		December 31,
	2019		2018
Derivative Assets:
Forward foreign currency exchange rate contracts	$	2,180	$	1,543
Total return swaps and other (a)		-		10,424
	$	2,180	$	11,967
Derivative Liabilities:
Forward foreign currency exchange rate contracts	$	1,442	$	939
Total return swaps and other (a)		4,626		1
LFI and other similar deferred compensation arrangements		229,436		188,022
	$	235,504	$	188,962

(a) For total return swaps, amounts represent the netting of gross derivative assets and liabilities of $139 and $4,765 as of June 30, 2019, respectively, and $10,792 and $369 as of December 31, 2018, respectively, for contracts with the same counterparty under legally enforceable master netting agreements. Such amounts are recorded “net” in “other assets”, with receivables for net cash collateral under such contracts of $5,950 as of June 30, 2019.

22

LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

Net gains (losses) with respect to derivative instruments (predominantly reflected in “revenue-other”) and the Company’s derivative liabilities relating to its obligations pertaining to LFI and other similar deferred compensation arrangements (included in “compensation and benefits” expense) as reflected on the accompanying condensed consolidated statements of operations for the three month and six month periods ended June 30, 2019 and 2018, were as follows:

	Three Months Ended					Six Months Ended
	June 30,					June 30,
	2019			2018		2019			2018
Forward foreign currency exchange rate contracts	$	(3,424	)	$	6,236	$	1,096		$	3,753
LFI and other similar deferred compensation arrangements		(6,484	)		499		(20,354	)		1,935
Total return swaps and other		(1,976	)		790		(9,633	)		2,446
Total	$	(11,884	)	$	7,525	$	(28,891	)	$	8,134

8. PROPERTY

At June 30, 2019 and December 31, 2018, property consisted of the following:

	Estimated Depreciable		June 30,		December 31,
	Life in Years		2019		2018
Buildings		33	$	144,148	$	145,034
Leasehold improvements	3-20			188,736		188,956
Furniture and equipment	3-10			205,607		204,585
Construction in progress				19,084		14,141
Total				557,575		552,716
Less - Accumulated depreciation and amortization				351,119		339,770
Property			$	206,456	$	212,946

9. LEASES

The Company adopted the new lease accounting guidance as of January 1, 2019, which resulted in recognition of ROU assets and lease liabilities related to operating leases on the condensed consolidated statements of financial condition. The Company determines if an arrangement is, or contains, a lease at its inception and reevaluates the arrangement if the terms are modified. Operating lease ROU assets represent the right to use an underlying asset for the lease term and operating lease liabilities reflect the obligation to make lease payments arising from the lease. At any given time during the lease term, the operating lease liability represents the present value of the remaining lease payments and the operating lease ROU asset is measured at the amount of the lease liability, adjusted for rent prepayments, unamortized initial direct costs and the remaining balance of lease incentives received. Both the operating lease ROU asset and the operating lease liability are reduced to zero at the end of the lease.

The Company leases office space and equipment under non-cancelable lease agreements, which expire on various dates through 2033. Substantially all of these arrangements are operating leases relating to office space. Certain leases have renewal options that can be exercised at the discretion of the Company. The Company only includes renewal options in the lease term when it is reasonably certain to exercise the option. The Company does not record leases with a lease term of 12 months or less on the condensed consolidated statements of financial condition; lease expense for these leases is recognized over the lease term on a straight-line basis.

For leases commencing on January 1, 2019 or thereafter that are recognized on the condensed consolidated statements of financial condition, the Company applies its estimated Discount. The Company bases this Discount on the information available at the lease commencement date. The Company determines its Discount with consideration of the Company’s public debt issuances as well as publicly available data for instruments with similar characteristics.

For leases commencing on January 1, 2019 or thereafter that relate to office space and equipment, the Company accounts for the lease and non-lease components as a single lease component.

23

LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

In addition to rent payments, operating leases for office space generally contain payments for real estate taxes, insurance costs, common area maintenance, and utilities that are not fixed. The Company accounts for these costs as variable payments and does not include them in the lease component. There are certain office leases outside of the U.S. that have annual rent increases that are also accounted for as variable payments and are excluded from the lease component.

The following table summarizes the components of operating lease expense reflected on the accompanying condensed consolidated statements of operations for the three month and six month periods ended June 30, 2019:

	Three Months Ended		Six Months Ended
	June 30, 2019		June 30, 2019
Operating lease cost	$	18,910	$	38,900
Variable lease cost		4,802		9,051
Less - sublease income		1,692		3,462
Total	$	22,020	$	44,489

The following table summarizes the supplemental cash flow information and certain other information related to operating leases for the six month period ended June 30, 2019:

	Six Months Ended
	June 30, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	39,759
Operating lease right-of-use assets obtained in exchange for operating lease liabilities	$	504,706
Weighted average remaining lease term	12 years
Weighted average discount rate		4.1	%

Maturities of the operating lease liabilities outstanding at June 30, 2019 for each of the years in the period ending December 31, 2024 and thereafter are set forth in the table below.

Year Ending December 31,
2019 (July 1 through December 31)	$	39,879
2020		76,856
2021		72,870
2022		56,879
2023		52,228
2024		51,045
Thereafter		360,876
Total lease payments		710,633
Less -  Discount		155,309
Operating lease liabilities	$	555,324

24

LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

Prior to the adoption of the new lease accounting guidance, the minimum rental commitments under non-cancelable operating leases at December 31, 2018, net of sublease income, were approximately as follows:

Year Ending December 31,
2019	$	86,839
2020		89,445
2021		83,701
2022		70,780
2023		59,973
Thereafter		488,612
Total minimum rental commitments		879,350
Less - sublease proceeds		26,941
Net rental commitments	$	852,409

In August 2018, the Company entered into a lease agreement for additional office facilities, which are currently under construction. The lease is expected to commence in the third quarter of 2019 when the facilities are delivered to the Company. The Company will recognize the related operating lease right-of-use assets and the operating lease liability on the lease commencement date. Operating lease commitments in the December 2018 table above include the impact of the new lease agreement.

10. GOODWILL AND OTHER INTANGIBLE ASSETS

The components of goodwill and other intangible assets at June 30, 2019 and December 31, 2018 are presented below:

	June 30,		December 31,
	2019		2018
Goodwill	$	371,536	$	371,561
Other intangible assets (net of accumulated    amortization)		2,900		3,757
	$	374,436	$	375,318

At June 30, 2019 and December 31, 2018, goodwill of $306,995 and $307,020, respectively, was attributable to the Company’s Financial Advisory segment and, at each such respective date, $64,541 of goodwill was attributable to the Company’s Asset Management segment.

Changes in the carrying amount of goodwill for the six month periods ended June 30, 2019 and 2018 are as follows:

	Six Months Ended
	June 30,
	2019			2018
Balance, January 1	$	371,561		$	385,292
Foreign currency translation adjustments		(25	)		(8,028	)
Balance, June 30	$	371,536		$	377,264

All changes in the carrying amount of goodwill for the six month periods ended June 30, 2019 and 2018 are attributable to the Company’s Financial Advisory segment.

25

LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

The gross cost and accumulated amortization of other intangible assets as of June 30, 2019 and December 31, 2018, by major intangible asset category, are as follows:

	June 30, 2019						December 31, 2018
	Gross Cost		Accumulated Amortization		Net Carrying Amount		Gross Cost		Accumulated Amortization		Net Carrying Amount
Success/incentive fees	$	35,322	$	33,075	$	2,247	$	35,232	$	32,235	$	2,997
Management fees, customer relationships and    non-compete agreements		34,486		33,833		653		34,474		33,714		760
	$	69,808	$	66,908	$	2,900	$	69,706	$	65,949	$	3,757

Amortization expense of intangible assets, included in “amortization and other acquisition-related (benefits) costs” in the condensed consolidated statements of operations, for the three month and six month periods ended June 30, 2019 was $431 and $862, respectively, and for the three month and six month periods ended June 30, 2018 was $863 and $1,696, respectively. Estimated future amortization expense is as follows:

Year Ending December 31,	Amortization Expense
2019 (July 1 through December 31)	$	862
2020		1,700
2021		150
2022		150
2023		38
Total amortization expense	$	2,900

11. SENIOR DEBT

Senior debt is comprised of the following as of June 30, 2019 and December 31, 2018:

							Outstanding as of
	Initial			Annual			June 30, 2019						December 31, 2018
	Principal Amount		Maturity Date	Interest Rate(b)			Principal		Unamortized Debt Costs		Carrying Value		Principal		Unamortized Debt Costs		Carrying Value
Lazard Group 2020    Senior Notes (a)	$	500,000	11/14/20		4.25	%	$	-	$	-	$	-	$	250,000	$	863	$	249,137
Lazard Group 2025    Senior Notes		400,000	2/13/25		3.75	%		400,000		2,652		397,348		400,000		2,888		397,112
Lazard Group 2027    Senior Notes		300,000	3/1/27		3.625	%		300,000		3,018		296,982		300,000		3,215		296,785
Lazard Group 2028    Senior Notes		500,000	9/19/28		4.50	%		500,000		8,323		491,677		500,000		8,774		491,226
Lazard Group 2029    Senior Notes (a)		500,000	3/11/29		4.375	%		500,000		7,876		492,124		-		-		-
Total							$	1,700,000	$	21,869	$	1,678,131	$	1,450,000	$	15,740	$	1,434,260

(a) During March 2019, Lazard Group completed an offering of $500,000 aggregate principal amount of 4.375% senior notes due 2029 (the “2029 Notes”).  Interest on the 2029 Notes is payable semi-annually on March 11 and September 11 of each year, beginning September 11, 2019.  Lazard Group used a portion of the net proceeds of the 2029 Notes to redeem or otherwise retire $250,000 aggregate principal amount of the 4.25% senior notes due 2020 (the “2020 Notes”). In March 2019, $167,943 aggregate principal amount was redeemed or otherwise retired, and the remaining $82,057 was redeemed or otherwise retired in April 2019.

(b) The effective interest rates of Lazard Group’s 3.75% senior notes due February 13, 2025 (the “2025 Notes”), Lazard Group’s 3.625% senior notes due March 1, 2027 (the “2027 Notes”), Lazard Group’s 4.50% senior notes due September 19, 2028 (the “2028 Notes”) and the 2029 Notes are 3.87%, 3.76%, 4.68% and 4.54% respectively.

26

LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

On September 25, 2015, Lazard Group entered into an Amended and Restated Credit Agreement for a five-year $150,000 senior revolving credit facility with a group of lenders (the “Amended and Restated Credit Agreement”), which expires in September 2020. The Amended and Restated Credit Agreement amended and restated the previous credit agreement dated September 25, 2012. Borrowings under the Amended and Restated Credit Agreement generally will bear interest at LIBOR plus an applicable margin for specific interest periods determined based on Lazard Group’s highest credit rating from an internationally recognized credit agency. At June 30, 2019 and December 31, 2018, no amounts were outstanding under the Amended and Restated Credit Agreement.

The Amended and Restated Credit Agreement, the indenture and the supplemental indentures relating to Lazard Group’s senior notes contain certain covenants, events of default and other customary provisions, including a customary make-whole provision in the event of early redemption, where applicable. As of June 30, 2019, the Company was in compliance with such provisions. All of the Company’s senior debt obligations are unsecured.

As of June 30, 2019, the Company had approximately $168,000 in unused lines of credit available to it, including the credit facility provided under the Amended and Restated Credit Agreement and unused lines of credit available to LFB of approximately $17,000.

The Company’s senior debt at June 30, 2019 and December 31, 2018 is carried at historical amounts of $1,678,131 and $1,434,260, respectively. At those dates, the fair value of such senior debt was approximately $1,782,000 and $1,429,000, respectively. The fair value of the Company’s senior debt is based on market quotations. The Company’s senior debt would be categorized within Level 2 of the hierarchy of fair value measurements if carried at fair value.

12. COMMITMENTS AND CONTINGENCIES

Guarantees—In the normal course of business, LFB provides indemnifications to third parties to protect them in the event of non-performance by its clients. At June 30, 2019, LFB had $3,469 of such indemnifications and held $3,469 of collateral/counter-guarantees to secure these commitments. The Company believes the likelihood of loss with respect to these indemnities is remote. Accordingly, no liability is recorded in the condensed consolidated statement of financial condition.

Business Acquisitions—For businesses acquired in 2016, the remaining consideration consists of (i) 40,524 shares of Class A common stock subject to non-compete provisions and employment conditions, and non-contingent interests exchangeable into 202,984 shares of Class A common stock, and (ii) up to 499,793 additional shares of Class A common stock that are subject to certain performance thresholds, as well as applicable related dividend equivalent amounts. During the six month period ended June 30, 2019, 368,635 of the contingent shares were earned, including dividend equivalent amounts.

Other Commitments—The Company has various other contractual commitments arising in the ordinary course of business. In addition, from time to time, each of LFB and LFNY may enter into underwriting commitments in which it will participate as an underwriter. At June 30, 2019, LFB and LFNY had no such underwriting commitments.

See Notes 6 and 15 for information regarding commitments relating to investment capital funding commitments and obligations to fund our pension plans, respectively.

In the opinion of management, the fulfillment of the commitments described herein will not have a material adverse effect on the Company’s condensed consolidated financial position or results of operations.

Legal—The Company is involved from time to time in judicial, regulatory and arbitration proceedings and inquiries concerning matters arising in connection with the conduct of our businesses, including proceedings initiated by former employees alleging wrongful termination. The Company reviews such matters on a case-by-case basis and establishes any required accrual if a loss is probable and the amount of such loss can be reasonably estimated. The Company experiences significant variation in its revenue and earnings on a quarterly basis. Accordingly, the results of any pending matter or matters could be significant when compared to the Company’s earnings in any particular fiscal quarter. The Company believes, however, based on currently available information, that the results of any pending matters, in the aggregate, will not have a material effect on its business or financial condition.

27

LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

13. STOCKHOLDERS’ EQUITY

Share Repurchase Program—During the six month period ended June 30, 2019 and since 2017, the Board of Directors of Lazard authorized the repurchase of Class A common stock as set forth in the table below:

Date	Repurchase Authorization		Expiration
October 2017	$	200,000	December 31, 2019
April 2018	$	300,000	December 31, 2020
October 2018	$	300,000	December 31, 2020
February 2019	$	300,000	December 31, 2020

The Company expects that the share repurchase program will continue to be used to offset a portion of the shares that have been or will be issued under the Lazard Ltd 2008 Incentive Compensation Plan (the “2008 Plan”) and the Lazard Ltd 2018 Incentive Compensation Plan (the “2018 Plan”). Pursuant to the share repurchase program, purchases have been made in the open market or through privately negotiated transactions. The rate at which the Company purchases shares in connection with the share repurchase program may vary from quarter to quarter due to a variety of factors. Purchases with respect to such program are set forth in the table below:

Six Months Ended June 30:	Number of Shares Purchased		Average Price Per Share
2018		4,147,526	$	53.96
2019		9,715,003	$	36.20

During the six month periods ended June 30, 2019 and 2018, certain of our executive officers received Class A common stock in connection with the vesting or settlement of previously-granted deferred equity incentive awards. The vesting or settlement of such equity awards gave rise to a tax payable by the executive officers, and, consistent with our past practice, the Company purchased shares of Class A common stock from certain of our executive officers equal in value to all or a portion of the estimated amount of such tax. In addition, during the six month period ended June 30, 2018, the Company purchased shares of Class A common stock from certain of our executive officers. The aggregate value of all such purchases during the six month periods ended June 30, 2019 and 2018 was approximately $14,600 and $16,400, respectively. Such shares of Class A common stock are reported at cost.

As of June 30, 2019, a total of $243,800 of share repurchase authorization remained available under the Company’s share repurchase program, all of which will expire on December 31, 2020.

During the six month period ended June 30, 2019, the Company had in place trading plans under Rule 10b5-1 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), pursuant to which it effected stock repurchases in the open market.

Preferred Stock—Lazard Ltd has 15,000,000 authorized shares of preferred stock, par value $0.01 per share, inclusive of its Series A and Series B preferred stock. Series A and Series B preferred shares were issued in connection with certain prior year business acquisitions and were each non-participating securities convertible into Class A common stock, and had no voting or dividend rights. As of both June 30, 2019 and December 31, 2018, no shares of Series A or Series B preferred stock were outstanding.

28

LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

Accumulated Other Comprehensive Income (Loss), Net of Tax—The tables below reflect the balances of each component of AOCI at June 30, 2019 and 2018 and activity during the three month and six month periods then ended:

	Three Months Ended June 30, 2019
	Currency Translation Adjustments			Employee Benefit Plans			Total AOCI			Amount Attributable to Noncontrolling Interests			Total Lazard Ltd AOCI
Balance, April 1, 2019	$	(126,357	)	$	(142,502	)	$	(268,859	)	$	(1	)	$	(268,858	)
Activity:
Other comprehensive income (loss) before    reclassifications		(7,053	)		2,812			(4,241	)		(2	)		(4,239	)
Adjustments for items reclassified to earnings,    net of tax		-			1,113			1,113			-			1,113
Net other comprehensive income (loss)		(7,053	)		3,925			(3,128	)		(2	)		(3,126	)
Balance, June 30, 2019	$	(133,410	)	$	(138,577	)	$	(271,987	)	$	(3	)	$	(271,984	)

	Six Months Ended June 30, 2019
	Currency Translation Adjustments			Employee Benefit Plans			Total AOCI			Amount Attributable to Noncontrolling Interests			Total Lazard Ltd AOCI
Balance, January 1, 2019	$	(130,137	)	$	(143,683	)	$	(273,820	)	$	(2	)	$	(273,818	)
Activity:
Other comprehensive income (loss) before    reclassifications		(3,273	)		2,861			(412	)		(1	)		(411	)
Adjustments for items reclassified to earnings,    net of tax		-			2,245			2,245			-			2,245
Net other comprehensive income (loss)		(3,273	)		5,106			1,833			(1	)		1,834
Balance, June 30, 2019	$	(133,410	)	$	(138,577	)	$	(271,987	)	$	(3	)	$	(271,984	)

	Three Months Ended June 30, 2018
	Currency Translation Adjustments			Employee Benefit Plans			Total AOCI			Amount Attributable to Noncontrolling Interests			Total Lazard Ltd AOCI
Balance, April 1, 2018	$	(66,189	)	$	(152,936	)	$	(219,125	)	$	(1	)	$	(219,124	)
Activity:
Other comprehensive income (loss) before    reclassifications		(43,453	)		8,300			(35,153	)		(1	)		(35,152	)
Adjustments for items reclassified to earnings,    net of tax		-			777			777			-			777
Net other comprehensive income (loss)		(43,453	)		9,077			(34,376	)		(1	)		(34,375	)
Balance, June 30, 2018	$	(109,642	)	$	(143,859	)	$	(253,501	)	$	(2	)	$	(253,499	)

29

LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

	Six Months Ended June 30, 2018
	Currency Translation Adjustments			Employee Benefit Plans			Total AOCI			Amount Attributable to Noncontrolling Interests			Total Lazard Ltd AOCI
Balance, January 1, 2018	$	(83,535	)	$	(148,984	)	$	(232,519	)	$	(1	)	$	(232,518	)
Activity:
Other comprehensive income (loss) before    reclassifications		(26,107	)		3,286			(22,821	)		(1	)		(22,820	)
Adjustments for items reclassified to earnings,    net of tax		-			1,839			1,839			-			1,839
Net other comprehensive income (loss)		(26,107	)		5,125			(20,982	)		(1	)		(20,981	)
Balance, June 30, 2018	$	(109,642	)	$	(143,859	)	$	(253,501	)	$	(2	)	$	(253,499	)

The table below reflects adjustments for items reclassified out of AOCI, by component, for the three month and six month periods ended June 30, 2019 and 2018:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2019		2018		2019		2018
Amortization relating to employee benefit plans (a)	$	1,287	$	1,245	$	2,597	$	2,523
Less - related income taxes		174		468		352		684
Total reclassifications, net of tax	$	1,113	$	777	$	2,245	$	1,839

(a) Included in the computation of net periodic benefit cost (see Note 15). Such amounts are included in “operating expenses—other” on the condensed consolidated statements of operations.

Noncontrolling Interests—Noncontrolling interests principally represent (i) interests held in Edgewater’s management vehicles that the Company is deemed to control, but does not own, (ii) profits interest participation rights (see Note 14) and (iii) consolidated VIE interests held by employees (see Note 21).

The tables below summarize net income attributable to noncontrolling interests for the three month and six month periods ended June 30, 2019 and 2018 and noncontrolling interests as of June 30, 2019 and December 31, 2018 in the Company’s condensed consolidated financial statements:

	Net Income Attributable to Noncontrolling Interests
	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2019		2018		2019		2018
Edgewater	$	7,501	$	1,415	$	6,935	$	3,383
Consolidated VIEs		234		-		234		-
Other		1		1		1		2
Total	$	7,736	$	1,416	$	7,170	$	3,385

30

LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

	Noncontrolling Interests as of
	June 30,		December 31,
	2019		2018
Edgewater	$	52,111	$	52,695
Profits interest participation rights		35,254		535
Consolidated VIEs		11,698		-
Other		13		12
Total	$	99,076	$	53,242

Dividends Declared, July 24, 2019—On July 24, 2019, the Board of Directors of Lazard declared a quarterly dividend of $0.47 per share on our Class A common stock. The dividend is payable on August 16, 2019, to stockholders of record on August 5, 2019.

14. INCENTIVE PLANS

Share-Based Incentive Plan Awards

A description of Lazard Ltd’s 2018 Plan, 2008 Plan and 2005 Equity Incentive Plan (the “2005 Plan”) and activity with respect thereto during the three month and six month periods ended June 30, 2019 and 2018 is presented below.

Shares Available Under the 2018 Plan, 2008 Plan and 2005 Plan

The 2018 Plan became effective on April 24, 2018 and replaced the 2008 Plan, which was terminated on April 24, 2018. The 2018 Plan authorizes the issuance of up to 30,000,000 shares of Class A common stock pursuant to the grant or exercise of stock options, stock appreciation rights, restricted stock units (“RSUs”), performance-based restricted stock units (“PRSUs”), profits interest participation rights and other share-based awards.

The 2008 Plan authorized the issuance of shares of Class A common stock pursuant to the grant or exercise of stock options, stock appreciation rights, RSUs, PRSUs and other share-based awards. Under the 2008 Plan, the maximum number of shares available was based on a formula that limited the aggregate number of shares that could, at any time, be subject to awards that were considered “outstanding” under the 2008 Plan to 30% of the then-outstanding shares of Class A common stock. The 2008 Plan was terminated on April 24, 2018, and no additional awards have been or will be granted under the 2008 Plan after its termination, although outstanding awards granted under the 2008 Plan before its termination continue to be subject to its terms.

The 2005 Plan authorized the issuance of up to 25,000,000 shares of Class A common stock pursuant to the grant or exercise of stock options, stock appreciation rights, RSUs and other share-based awards. The 2005 Plan expired in the second quarter of 2015, although outstanding deferred stock unit (“DSU”) awards granted under the 2005 Plan before its expiration continue to be subject to its terms.

The following reflects the amortization expense recorded with respect to share-based incentive plans within “compensation and benefits” expense (with respect to RSUs, PRSUs and other share-based awards) and “professional services” expense (with respect to DSUs) within the Company’s accompanying condensed consolidated statements of operations for the three month and six month periods ended June 30, 2019 and 2018:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2019		2018		2019		2018
Share-based incentive awards:
RSUs	$	48,194	$	55,635	$	103,391	$	116,522
PRSUs		928		17,051		2,249		28,018
Restricted Stock		8,085		12,600		17,597		23,373
Profits interest participation rights		17,413		-		35,881		-
DSUs		1,782		1,724		1,965		1,917
Total	$	76,402	$	87,010	$	161,083	$	169,830

31

LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

The ultimate amount of compensation and benefits expense relating to share-based awards is dependent upon the actual number of shares of Class A common stock that vest. The Company periodically assesses the forfeiture rates used for such estimates, including as a result of any applicable performance conditions. A change in estimated forfeiture rates or performance results in a cumulative adjustment to compensation and benefits expense and also would cause the aggregate amount of compensation expense recognized in future periods to differ from the estimated unrecognized compensation expense described below.

The Company’s share-based incentive plans and awards are described below.

RSUs and DSUs

RSUs generally require future service as a condition for the delivery of the underlying shares of Class A common stock (unless the recipient is then eligible for retirement under the Company’s retirement policy) and convert into shares of Class A common stock on a one-for-one basis after the stipulated vesting periods. The grant date fair value of the RSUs, net of an estimated forfeiture rate, is amortized over the vesting periods or requisite service periods (generally one-third after two years, and the remaining two-thirds after the third year), and is adjusted for actual forfeitures over such period.

RSUs generally include a dividend participation right that provides that during vesting periods each RSU is attributed additional RSUs (or fractions thereof) equivalent to any dividends paid on Class A common stock during such period. During the six month period ended June 30, 2019, dividend participation rights required the issuance of 566,194 RSUs and the associated charge to “retained earnings”, net of estimated forfeitures (with corresponding credits to “additional paid-in-capital”) was $20,142.

Non-executive members of the Board of Directors (“Non-Executive Directors”) receive approximately 55% of their annual compensation for service on the Board of Directors and its committees in the form of DSUs, which resulted in 51,192 DSUs granted during the six month period ended June 30, 2019.  Their remaining compensation is payable in cash, which they may elect to receive in the form of additional DSUs under the Directors’ Fee Deferral Unit Plan described below. DSUs are convertible into shares of Class A common stock at the time of cessation of service to the Board of Directors. DSUs include a cash dividend participation right equivalent to dividends paid on Class A common stock.

The Company’s Directors’ Fee Deferral Unit Plan permits the Non-Executive Directors to elect to receive additional DSUs in lieu of some or all of their cash fees. The number of DSUs granted to a Non-Executive Director pursuant to this election will equal the value of cash fees that the applicable Non-Executive Director has elected to forego pursuant to such election, divided by the market value of a share of Class A common stock on the date immediately preceding the date of the grant. During the six month period ended June 30, 2019, 10,257 DSUs had been granted pursuant to such Plan.

DSU awards are expensed at their fair value on their date of grant, inclusive of amounts related to the Directors’ Fee Deferral Unit Plan.

The following is a summary of activity relating to RSUs and DSUs during the six month period ended June 30, 2019:

	RSUs					DSUs
	Units			Weighted Average Grant Date Fair Value		Units		Weighted Average Grant Date Fair Value
Balance, January 1, 2019		11,362,306		$	43.78		323,546	$	39.27
Granted (including 566,194 RSUs relating to dividend    participation)		5,564,865		$	38.32		61,449	$	31.97
Forfeited		(368,195	)	$	42.68		-	$	-
Settled		(5,795,423	)	$	37.03		-	$	-
Balance, June 30, 2019		10,763,553		$	44.63		384,995	$	38.10

In connection with RSUs that settled during the six month period ended June 30, 2019, the Company satisfied its minimum statutory tax withholding requirements in lieu of delivering 2,023,986 shares of Class A common stock during such six month period. Accordingly, 3,771,437 shares of Class A common stock held by the Company were delivered during the six month period ended June 30, 2019.

32

LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

As of June 30, 2019, estimated unrecognized RSU compensation expense was $195,263, with such expense expected to be recognized over a weighted average period of approximately 0.9 years subsequent to June 30, 2019.

Restricted Stock

The following is a summary of activity related to shares of restricted Class A common stock associated with compensation arrangements during the six month period ended June 30, 2019:

	Restricted Shares			Weighted Average Grant Date Fair Value
Balance, January 1, 2019		1,541,058		$	43.16
Granted		1,039,736		$	35.32
Forfeited		(194,097	)	$	41.28
Settled		(1,159,850	)	$	38.37
Balance, June 30, 2019		1,226,847		$	41.34

In connection with shares of restricted Class A common stock that settled during the six month period ended June 30, 2019, the Company satisfied its minimum statutory tax withholding requirements in lieu of delivering 370,777 shares of Class A common stock during such six month period. Accordingly, 789,073 shares of Class A common stock held by the Company were delivered during the six month period ended June 30, 2019.

The restricted stock awards include a cash dividend participation right equivalent to dividends paid on Class A common stock during the period, which will vest concurrently with the underlying restricted stock award. At June 30, 2019, estimated unrecognized restricted stock expense was $28,337, with such expense to be recognized over a weighted average period of approximately 1.0 years subsequent to June 30, 2019.

PRSUs

PRSUs are RSUs that are subject to both performance-based and service-based vesting conditions. The number of shares of Class A common stock that a recipient will receive upon vesting of a PRSU will be calculated by reference to certain performance metrics that relate to the Company’s performance over a three-year period. The target number of shares of Class A common stock subject to each PRSU is one; however, based on the achievement of the performance criteria, the number of shares of Class A common stock that may be received in connection with each PRSU generally can range from zero to two times the target number. PRSUs will vest on a single date approximately three years following the date of the grant, provided the applicable service and performance conditions are satisfied. In addition, the performance metrics applicable to each PRSU will be evaluated on an annual basis at the end of each fiscal year during the performance period and, if the Company has achieved a threshold level of performance with respect to the fiscal year, 25% of the target number of shares of Class A common stock subject to each PRSU will no longer be at risk of forfeiture based on the achievement of performance criteria. PRSUs include dividend participation rights that provide that during vesting periods, the target number of PRSUs (or, following the relevant performance period, the actual number of shares of Class A common stock that are no longer subject to performance conditions) receive dividend equivalents at the same rate that dividends are paid on Class A common stock during such periods. These dividend equivalents are credited as RSUs that are not subject to the performance-based vesting criteria but are otherwise subject to the same restrictions as the underlying PRSUs to which they relate.

The following is a summary of activity relating to PRSUs during the six month period ended June 30, 2019:

	PRSUs			Weighted Average Grant Date Fair Value
Balance, January 1, 2019		1,771,795		$	38.66
Settled		(1,171,081	)	$	32.44
Balance, June 30, 2019		600,714		$	50.78

33

LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

In connection with certain PRSUs that settled during the six month period ended June 30, 2019, the Company satisfied its minimum statutory tax withholding requirements in lieu of delivering 203,036 shares of Class A common stock during such six month period. Accordingly, 968,045 shares of Class A common stock held by the Company were delivered during the six month period ended June 30, 2019.

Compensation expense recognized for PRSU awards is determined by multiplying the number of shares of Class A common stock underlying such awards that, based on the Company’s estimate, are considered probable of vesting, by the grant date fair value. As of June 30, 2019, the total estimated unrecognized compensation expense was $4,249, and the Company expects to amortize such expense over a weighted-average period of approximately 0.7 years subsequent to June 30, 2019.

Profits Interest Participation Rights

In early 2019, the Company established a new long-term incentive compensation program consisting of profits interest participation rights, which are equity incentive awards that, subject to certain conditions, may be exchanged for shares of Class A common stock pursuant to the 2018 Plan.  Pursuant to the program, in February 2019, the Company granted profits interest participation rights subject to service-based and performance-based vesting criteria and other conditions, which we refer to as performance-based restricted participation units (“PRPUs”), to each of the Company’s NEOs, and profits interest participation rights subject to service-based vesting criteria and other conditions to a limited number of other senior employees, pursuant to profits interest participation right agreements.  Profits interest participation rights generally provide for vesting approximately three years following the grant date, so long as applicable conditions have been satisfied.

Profits interest participation rights are a class of membership interests in Lazard Group that are intended to qualify as “profits interests” for U.S. federal income tax purposes, and are recorded as noncontrolling interests within stockholders’ equity in the Company’s condensed consolidated statements of financial condition until they are exchanged into Class A common stock, at which time there is a reclassification to additional paid-in-capital.  The profits interest participation rights generally allow the recipient to realize value only to the extent that both (i) the service-based vesting conditions and, if applicable, the performance conditions, are satisfied, and (ii) an amount of economic appreciation in the assets of Lazard Group occurs as necessary to satisfy certain partnership tax rules (referred to as the "Minimum Value Condition") before the fifth anniversary of the grant date, otherwise the profits interest participation rights will be forfeited.  Upon satisfaction of such conditions, profits interest participation rights that are in parity with the value of Class A common stock will be exchanged on a one-for-one basis for shares of Class A common stock. If forfeited based solely on failing to meet the Minimum Value Condition, the associated compensation expense would not be reversed.  

Like outstanding RSUs and similar awards, profits interest participation rights will be subject to continued employment and other conditions and restrictions and will be forfeited if those conditions and restrictions are not fulfilled. More specifically, vesting of profits interest participation rights will be subject to compliance with restrictive covenants including non-compete, non-solicitation of clients, no hire of employees and confidentiality, which are similar to those applicable to PRSUs and RSUs. In addition, profits interest participation rights must satisfy the Minimum Value Condition.  PRPUs, like outstanding PRSUs, will be subject to the achievement of incremental pre-established performance conditions and financial metrics and will only result in value to the recipient to the extent the conditions are satisfied.

The number of shares of Class A common stock that a recipient will receive upon the exchange of a PRPU award will be calculated by reference to applicable financial metrics.  The target number of shares of Class A common stock subject to each PRPU is one. Based on the achievement of performance criteria, as determined by the Compensation Committee, the number of shares of Class A common stock that may be received in connection with each PRPU award will range from zero to two times the target number.  Unless applicable performance conditions are satisfied during the three year performance period, and the Minimum Value Condition is satisfied within five years following the grant date, all PRPUs will be forfeited, and the recipients will not be entitled to any such awards.  

In addition, the performance metrics applicable to each PRPU will be evaluated on an annual basis at the end of each fiscal year during the performance period, and, if the Company has achieved a threshold level of performance with respect to the fiscal year, 25% of the target number of PRPUs will no longer be at risk of forfeiture based on the achievement of performance criteria. Profits interest participation rights are allocated income, subject to vesting and settled in cash, in respect of dividends paid on Class A common stock.

34

LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

The following is a summary of activity relating to profits interest participation rights, including PRPUs, during the six month period ended June 30, 2019:

	Profits Interest Participation Rights		Weighted Average Grant Date Fair Value
Balance, January 1, 2019		-		-
Granted (a)		1,462,702	$	38.65
Balance, June 30, 2019		1,462,702	$	38.65

(a) Table includes the target number of PRPUs assuming the achievement of applicable performance conditions at the target level.

Compensation expense recognized for profits interest participation rights, including PRPUs, is determined by multiplying the number of shares of Class A common stock underlying such awards that, based on the Company’s estimate, are considered probable of vesting, by the grant date fair value.  As of June 30, 2019, the total estimated unrecognized compensation expense was $20,652, and the Company expects to amortize such expense over a weighted-average period of approximately 1.3 years subsequent to June 30, 2019.

LFI and Other Similar Deferred Compensation Arrangements

Commencing in February 2011, the Company granted LFI to eligible employees. In connection with LFI and other similar deferred compensation arrangements, which generally require future service as a condition for vesting, the Company recorded a prepaid compensation asset and a corresponding compensation liability on the grant date based upon the fair value of the award. The prepaid asset is amortized on a straight-line basis over the applicable vesting periods or requisite service periods (which are generally similar to the comparable periods for RSUs), and is charged to “compensation and benefits” expense within the Company’s condensed consolidated statement of operations. LFI and similar deferred compensation arrangements that do not require future service are expensed immediately. The related compensation liability is accounted for at fair value as a derivative liability, which contemplates the impact of estimated forfeitures, and is adjusted for changes in fair value primarily related to changes in value of the underlying investments.

The following is a summary of activity relating to LFI and other similar deferred compensation arrangements during the six month period ended June 30, 2019:

	Prepaid Compensation Asset			Compensation Liability
Balance, January 1, 2019	$	76,362		$	188,022
Granted		101,340			101,340
Settled		-			(82,990	)
Forfeited		(646	)		(983	)
Amortization		(59,283	)		-
Change in fair value related to:
Increase in fair value of underlying investments		-			20,354
Adjustment for estimated forfeitures		-			3,198
Other		275			495
Balance, June 30, 2019	$	118,048		$	229,436

The amortization of the prepaid compensation asset will generally be recognized over a weighted average period of approximately 1.0 years subsequent to June 30, 2019.

35

LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

The following is a summary of the impact of LFI and other similar deferred compensation arrangements on “compensation and benefits” expense within the accompanying condensed consolidated statements of operations for the three month and six month periods ended June 30, 2019 and 2018:

	Three Months Ended					Six Months Ended
	June 30,					June 30,
	2019		2018			2019		2018
Amortization, net of forfeitures	$	44,210	$	36,293		$	62,144	$	52,129
Change in the fair value of underlying investments		6,484		(499	)		20,354		(1,935	)
Total	$	50,694	$	35,794		$	82,498	$	50,194

15. EMPLOYEE BENEFIT PLANS

The Company provides retirement and other post-retirement benefits to certain of its employees through defined benefit pension plans (the “pension plans”). The Company also offers defined contribution plans to its employees. The pension plans generally provide benefits to participants based on average levels of compensation. Expenses related to the Company’s employee benefit plans are included in “compensation and benefits” expense for the service cost component, and “operating expenses—other” for the other components of benefit costs on the condensed consolidated statements of operations.

Employer Contributions to Pension Plans—The Company’s funding policy for its U.S. and non-U.S. pension plans is to fund when required or when applicable upon an agreement with the plans’ trustees. Management also evaluates from time to time whether to make voluntary contributions to the plans.

The following table summarizes the components of net periodic benefit cost (credit) related to the Company’s pension plans for the three month and six month periods ended June 30, 2019 and 2018:

	Three Months Ended June 30,
	2019			2018
Components of Net Periodic Benefit Cost (Credit):
Service cost	$	205		$	223
Interest cost		3,858			3,977
Expected return on plan assets		(6,873	)		(7,583	)
Amortization of:
Prior service cost		27			-
Net actuarial loss (gain)		1,260			1,245
Settlement loss		1,739			-
Net periodic benefit cost (credit)	$	216		$	(2,138	)

	Six Months Ended June 30,
	2019			2018
Components of Net Periodic Benefit Cost (Credit):
Service cost	$	412		$	453
Interest cost		7,760			8,039
Expected return on plan assets		(13,899	)		(15,366	)
Amortization of:
Prior service cost		56			-
Net actuarial loss (gain)		2,541			2,523
Settlement loss		3,522			-
Net periodic benefit cost (credit)	$	392		$	(4,351	)

36

LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

16. INCOME TAXES

Lazard Ltd, through its subsidiaries, is subject to U.S. federal income taxes on all of its U.S. operating income, as well as on the portion of non-U.S. income attributable to its U.S. subsidiaries. In addition, Lazard Ltd, through its subsidiaries, is subject to state and local taxes on its income apportioned to various state and local jurisdictions. Outside the U.S., Lazard Group operates principally through subsidiary corporations that are subject to local income taxes in foreign jurisdictions. Lazard Group is also subject to Unincorporated Business Tax (“UBT”) attributable to its operations apportioned to New York City.

The Company recorded income tax provisions of $28,172 and $51,359 for the three month and six month periods ended June 30, 2019, respectively, and $51,561 and $75,728 for the three month and six month periods ended June 30, 2018, respectively, representing effective tax rates of 27.7%, 23.2%, 25.8% and 19.6%, respectively. The difference between the U.S. federal statutory rate of 21.0% and the effective tax rates reflected above principally relates to (i) excess net tax benefit for share-based incentive compensation, (ii) foreign source income (loss) not subject to U.S. income taxes (including interest on intercompany financings), (iii) taxes payable to foreign jurisdictions that are not offset against U.S. income taxes, (iv) change in the U.S. federal valuation allowance affecting the provision for income taxes, (v) U.S. state and local taxes, which are incremental to the U.S. federal statutory tax rate, and (vi) impact of U.S. tax reform, including base erosion and anti-abuse tax.

17. NET INCOME PER SHARE OF CLASS A COMMON STOCK

The Company issued certain profits interest participation rights, including certain PRPUs, that the Company is required under U.S. GAAP to treat as participating securities and therefore the Company is required to utilize the “two-class” method of computing basic and diluted net income per share.

The Company’s basic and diluted net income per share calculations using the “two-class” method for the three month and six month periods ended June 30, 2019 and using the “treasury stock” method for the three month and six month periods ended June 30, 2018 are presented below:

	Three Months Ended					Six Months Ended
	June 30,					June 30,
	2019			2018		2019			2018
Net income attributable to Lazard Ltd	$	65,777		$	146,963	$	162,819		$	306,655
Add - adjustment for earnings attributable to participating    securities		(1,604	)		-		(1,604	)		-
Net income attributable to Lazard Ltd - basic		64,173			146,963		161,215			306,655
Add - adjustment for earnings attributable to participating    securities		5			-		5			-
Net income attributable to Lazard Ltd - diluted	$	64,178		$	146,963	$	161,220		$	306,655
Weighted average number of shares of Class A common    stock outstanding		110,076,582			120,049,627		110,847,112			119,872,688
Add - adjustment for shares of Class A common stock    issuable on a non-contingent basis		1,904,622			256,630		1,115,617			245,494
Weighted average number of shares of Class A common    stock outstanding - basic		111,981,204			120,306,257		111,962,729			120,118,182
Add - dilutive effect, as applicable, of:
Weighted average number of incremental shares of Class A    common stock issuable from share-based    incentive compensation		4,194,145			9,942,797		6,534,988			11,077,543
Weighted average number of shares of Class A common stock    outstanding - diluted		116,175,349			130,249,054		118,497,717			131,195,725
Net income attributable to Lazard Ltd per share of Class    A common stock:
Basic	$	0.57		$	1.22	$	1.44		$	2.55
Diluted	$	0.55		$	1.13	$	1.36		$	2.34

37

LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

18. RELATED PARTIES

Sponsored Funds

The Company serves as an investment advisor for certain affiliated investment companies and fund entities and receives management fees and, for the alternative investment funds, performance-based incentive fees for providing such services. Investment advisory fees relating to such services were $153,198 and $297,368 for the three month and six month periods ended June 30, 2019, respectively, and $170,680 and $351,990 for the three month and six month periods ended June 30, 2018, respectively, and are included in “asset management fees” on the condensed consolidated statements of operations. Of such amounts, $56,696 and $59,304 remained as receivables at June 30, 2019 and December 31, 2018, respectively, and are included in “fees receivable” on the condensed consolidated statements of financial condition.

Tax Receivable Agreement

The Second Amended and Restated Tax Receivable Agreement, dated as of October 26, 2015 (the “Amended and Restated Tax Receivable Agreement”), between Lazard and LTBP Trust, a Delaware statutory trust (the “Trust”), provides for the payment by our subsidiaries to the Trust of (i) approximately 45% of the amount of cash savings, if any, in U.S. federal, state and local income tax or franchise tax that we actually realize as a result of certain increases in tax basis and of certain other tax benefits related to the Amended and Restated Tax Receivable Agreement, and (ii) an amount that we currently expect will approximate 85% of the cash tax savings that may arise from tax benefits attributable to payments under the Amended and Restated Tax Receivable Agreement. Our subsidiaries expect to benefit from the balance of cash savings, if any, in income tax that our subsidiaries realize. Any amount paid by our subsidiaries to the Trust will generally be distributed to the owners of the Trust, who include certain of our executive officers, in proportion to their beneficial interests in the Trust.

For purposes of the Amended and Restated Tax Receivable Agreement, cash savings in income and franchise tax will be computed by comparing our subsidiaries’ actual income and franchise tax liability to the amount of such taxes that our subsidiaries would have been required to pay had there been no increase in the tax basis of certain tangible and intangible assets of Lazard Group attributable to our subsidiaries’ interest in Lazard Group and had our subsidiaries not entered into the Amended and Restated Tax Receivable Agreement.  The term of the Amended and Restated Tax Receivable Agreement will continue until approximately 2033 or, if earlier, until all relevant tax benefits have been utilized or expired.

The amount of the Amended and Restated Tax Receivable Agreement liability is an undiscounted amount based upon currently enacted tax laws, the current structure of the Company and various assumptions regarding potential future operating profitability. The assumptions reflected in the estimate involve significant judgment. For example, if our structure were to change or our annual taxable income were to increase, we could be required to accelerate payments under the Amended and Restated Tax Receivable Agreement. As such, the actual amount and timing of payments under the Amended and Restated Tax Receivable Agreement could differ materially from our estimates. Any changes in the amount of the estimated liability would be recorded as a non-compensation expense in the condensed consolidated statement of operations. Adjustments, if necessary, to the related deferred tax assets would be recorded through the “provision (benefit) for income taxes”.

The cumulative liability relating to our obligations under the Amended and Restated Tax Receivable Agreement as of June 30, 2019 and December 31, 2018 was $246,953 and $270,640, respectively, and is recorded in “tax receivable agreement obligation” on the condensed consolidated statements of financial condition. The balance at June 30, 2019 reflects a payment made under the Amended and Restated Tax Receivable Agreement in the six months ended June 30, 2019 of $23,687.

Other

During the six month period ended June 30, 2019, the Company recognized approximately $3,000 of investment banking and other advisory fees pertaining to financial advisory services provided to a company of which a member of the Company’s Board of Directors served as Chairman and CEO. The engagement terms were negotiated in the ordinary course of business on an arms-length basis.

See Note 13 for information regarding related party transactions pertaining to shares repurchased from certain of our executive officers.

38

LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

19. REGULATORY AUTHORITIES

LFNY is a U.S. registered broker-dealer and is subject to the net capital requirements of Rule 15c3-1 under the Exchange Act. Under the basic method permitted by this rule, the minimum required net capital, as defined, is a specified fixed percentage (6 ²/₃%) of total aggregate indebtedness recorded in LFNY’s Financial and Operational Combined Uniform Single (“FOCUS”) report filed with the Financial Industry Regulatory Authority (“FINRA”), or $100, whichever is greater. In addition, the ratio of aggregate indebtedness (as defined) to net capital may not exceed 15:1. At June 30, 2019, LFNY’s regulatory net capital was $90,760, which exceeded the minimum requirement by $87,343. LFNY’s aggregate indebtedness to net capital ratio was 0.56:1 as of June 30, 2019.

Certain U.K. subsidiaries of the Company, including LCL, Lazard Fund Managers Limited and Lazard Asset Management Limited (collectively, the “U.K. Subsidiaries”) are regulated by the Financial Conduct Authority. At June 30, 2019, the aggregate regulatory net capital of the U.K. Subsidiaries was $167,610, which exceeded the minimum requirement by $151,085.

CFLF, under which asset management and commercial banking activities are carried out in France, is subject to regulation by the Autorité de Contrôle Prudentiel et de Résolution (“ACPR”) for its banking activities conducted through its subsidiary, LFB. LFB, as a registered bank, is engaged primarily in commercial and private banking services for clients and funds managed by LFG (asset management) and other clients, and asset-liability management. The investment services activities of the Paris group, exercised through LFB and other subsidiaries of CFLF, primarily LFG, also are subject to regulation and supervision by the Autorité des Marchés Financiers. At June 30, 2019, the consolidated regulatory net capital of CFLF was $168,669, which exceeded the minimum requirement set for regulatory capital levels by $111,947. In addition, pursuant to the consolidated supervision rules in the European Union, LFB, in particular, as a French credit institution, is required to be supervised by a regulatory body, either in the U.S. or in the European Union. During the third quarter of 2013, the Company and the ACPR agreed on terms for the consolidated supervision of LFB and certain other non-Financial Advisory European subsidiaries of the Company (referred to herein, on a combined basis, as the “combined European regulated group”) under such rules. Under this supervision, the combined European regulated group is required to comply with minimum requirements for regulatory net capital to be reported on a quarterly basis and satisfy periodic financial and other reporting obligations. At March 31, 2019, the regulatory net capital of the combined European regulated group was $157,090, which exceeded the minimum requirement set for regulatory capital levels by $53,516. Additionally, the combined European regulated group, together with our European Financial Advisory entities, is required to perform an annual risk assessment and provide certain other information on a periodic basis, including financial reports and information relating to financial performance, balance sheet data and capital structure.

Certain other U.S. and non-U.S. subsidiaries are subject to various capital adequacy requirements promulgated by various regulatory and exchange authorities in the countries in which they operate. At June 30, 2019, for those subsidiaries with regulatory capital requirements, their aggregate net capital was $163,269, which exceeded the minimum required capital by $135,064.

At June 30, 2019, each of these subsidiaries individually was in compliance with its regulatory capital requirements.

Any new or expanded rules and regulations that may be adopted in countries in which we operate (including regulations that have not yet been proposed) could affect us in other ways.

20. SEGMENT INFORMATION

The Company’s reportable segments offer different products and services and are managed separately as different levels and types of expertise are required to effectively manage the segments’ transactions. Each segment is reviewed to determine the allocation of resources and to assess its performance. The Company’s principal operating activities are included in its Financial Advisory and Asset Management business segments as described in Note 1. In addition, as described in Note 1, the Company records selected other activities in its Corporate segment.

The Company’s segment information for the three month and six month periods ended June 30, 2019 and 2018 is prepared using the following methodology:

• Revenue and expenses directly associated with each segment are included in determining operating income.

• Expenses not directly associated with specific segments are allocated based on the most relevant measures applicable, including headcount, square footage and other factors.

• Segment assets are based on those directly associated with each segment, and include an allocation of certain assets relating to various segments, based on the most relevant measures applicable, including headcount, square footage and other factors.

39

LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

The Company allocates investment gains and losses, interest income and interest expense among the various segments based on the segment in which the underlying asset or liability is reported.

Each segment’s operating expenses include (i) compensation and benefits expenses incurred directly in support of the businesses and (ii) other operating expenses, which include directly incurred expenses for occupancy and equipment, marketing and business development, technology and information services, professional services, fund administration and outsourced services and indirect support costs (including compensation and other operating expenses related thereto) for administrative services. Such administrative services include, but are not limited to, accounting, tax, human resources, legal, facilities management and senior management activities.

Management evaluates segment results based on net revenue and operating income (loss) and believes that the following information provides a reasonable representation of each segment’s contribution with respect to net revenue, operating income (loss) and total assets:

		Three Months Ended						Six Months Ended
		June 30,						June 30,
		2019			2018			2019			2018
Financial Advisory	Net Revenue	$	329,612		$	422,089		$	667,982		$	831,210
	Operating Expenses		276,238			318,177			556,499			642,873
	Operating Income	$	53,374		$	103,912		$	111,483		$	188,337
Asset Management	Net Revenue	$	315,591		$	352,588		$	617,424		$	706,871
	Operating Expenses		219,021			229,561			426,369			459,230
	Operating Income	$	96,570		$	123,027		$	191,055		$	247,641
Corporate	Net Revenue	$	(14,513	)	$	(16,739	)	$	(11,042	)	$	(25,445	)
	Operating Expenses		33,746			10,260			70,148			24,765
	Operating Loss	$	(48,259	)	$	(26,999	)	$	(81,190	)	$	(50,210	)
Total	Net Revenue	$	630,690		$	757,938		$	1,274,364		$	1,512,636
	Operating Expenses		529,005			557,998			1,053,016			1,126,868
	Operating Income	$	101,685		$	199,940		$	221,348		$	385,768

	As Of
	June 30, 2019		December 31, 2018
Total Assets
Financial Advisory	$	981,571	$	859,306
Asset Management		702,530		728,220
Corporate		3,823,372		3,409,715
Total	$	5,507,473	$	4,997,241

40

LAZARD LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

(UNAUDITED)

(dollars in thousands, except for per share data, unless otherwise noted)

21. CONSOLIDATED VIEs

The Company’s consolidated VIEs as of June 30, 2019 include certain funds that were recently established for the benefit of employees participating in the Company’s existing LFI deferred compensation arrangement.  Lazard invests in these funds and is the investment manager and is therefore deemed to have both the power to direct the most significant activities of the funds and the right to receive benefits (or the obligation to absorb losses) that could potentially be significant to these funds.  The Company’s consolidated VIE assets and liabilities as reflected in the condensed consolidated statements of financial condition consist of the following at June 30, 2019:

ASSETS
Cash and cash equivalents	$	4,543
Customers and other receivables		353
Investments (a)		89,762
Other assets		572
Total Assets	$	95,230

LIABILITIES
Deposits and other customer payables	$	1,033
Other liabilities		286
Total Liabilities	$	1,319

(a) Includes $81,999 of LFI held by Lazard Group which is eliminated in the condensed consolidated statements of financial condition.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read in conjunction with Lazard Ltd’s condensed consolidated financial statements and the related notes included elsewhere in this Quarterly Report on Form 10-Q (the “Form 10-Q”), as well as Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) included in our Annual Report on Form 10-K for the year ended December 31, 2018 (the “Form 10-K”). All references to “2019,” “2018,” “second quarter,” “first half” or “the period” refer to, as the context requires, the three month and six month periods ended June 30, 2019 and June 30, 2018.

Forward-Looking Statements and Certain Factors that May Affect Our Business

Management has included in Parts I and II of this Form 10-Q, including in its MD&A, statements that are forward-looking statements. In some cases, you can identify these statements by forward-looking words such as “may,” “might,” “will,” “should,” “could,” “would,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “target,” “goal” or “continue,” and the negative of these terms and other comparable terminology. These forward-looking statements, which are subject to known and unknown risks, uncertainties and assumptions about us, may include projections of our future financial performance based on our growth strategies, business plans and initiatives and anticipated trends in our business. These statements are only predictions based on our current expectations and projections about future events. There are important factors that could cause our actual results, level of activity, performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by the forward-looking statements. These factors include, but are not limited to, those discussed in our Form 10-K under the caption “Risk Factors,” including the following:

• a decline in general economic conditions or the global or regional financial markets;

• a decline in our revenues, for example due to a decline in overall mergers and acquisitions (“M&A”) activity, our share of the M&A market or our assets under management (“AUM”);

• losses caused by financial or other problems experienced by third parties;

• losses due to unidentified or unanticipated risks;

• a lack of liquidity, i.e., ready access to funds, for use in our businesses; and

• competitive pressure on our businesses and on our ability to retain and attract employees at current compensation levels.

These risks and uncertainties are not exhaustive. Other sections of the Form 10-K and this Form 10-Q describe additional factors that could adversely affect our business and financial performance. Moreover, we operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible for our management to predict all risks and uncertainties, nor can management assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.

Although we believe the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, level of activity, performance or achievements. Moreover, neither we nor any other person assumes responsibility for the accuracy or completeness of any of these forward-looking statements. You should not rely upon forward-looking statements as predictions of future events. We are under no duty to update any of these forward-looking statements after the date of this Form 10-Q to conform our prior statements to actual results or revised expectations and we do not intend to do so.

Forward-looking statements include, but are not limited to, statements about:

• financial goals, including ratios of compensation and benefits expense to operating revenue;

• ability to deploy surplus cash through dividends, share repurchases and debt repurchases;

• ability to offset stockholder dilution through share repurchases;

• possible or assumed future results of operations and operating cash flows;

• strategies and investment policies;

• financing plans and the availability of short-term borrowing;

• competitive position;

• future acquisitions, including the consideration to be paid and the timing of consummation;

• potential growth opportunities available to our businesses;

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• potential impact of investments in our technology infrastructure and data science capabilities;

• recruitment and retention of our managing directors and employees;

• potential levels of compensation expense, including awarded compensation and benefits expense and adjusted compensation and benefits expense, and non-compensation expense;

• potential operating performance, achievements, productivity improvements, efficiency and cost reduction efforts;

• likelihood of success and impact of litigation;

• expected tax rates, including effective tax rates;

• changes in interest and tax rates;

• availability of certain tax benefits, including certain potential deductions;

• potential impact of certain events or circumstances on our financial statements;

• changes in foreign currency exchange rates;

• expectations with respect to the economy, the securities markets, the market for mergers, acquisitions, restructuring and other financial advisory activity, the market for asset management activity and other macroeconomic, regional and industry trends;

• effects of competition on our business; and

• impact of new or future legislation and regulation, including tax laws and regulations, on our business.

The Company is committed to providing timely and accurate information to the investing public, consistent with our legal and regulatory obligations. To that end, the Company uses its website, its twitter account (twitter.com/Lazard) and other social media sites to convey information about our businesses, including the anticipated release of quarterly financial results, quarterly financial, statistical and business-related information, and the posting of updates of AUM in our Asset Management business. Investors can link to Lazard Ltd, Lazard Group and their operating company websites through http://www.lazard.com. Our websites and social media sites and the information contained therein or connected thereto shall not be deemed to be incorporated into this Form 10-Q.

Business Summary

Lazard is one of the world’s preeminent financial advisory and asset management firms. We have long specialized in crafting solutions to the complex financial and strategic challenges of a diverse set of clients around the world, including corporations, governments, institutions, partnerships and individuals. Founded in 1848 in New Orleans, we currently operate from 43 cities in key business and financial centers across 27 countries throughout North America, Europe, Asia, Australia, the Middle East, and Central and South America.

Our primary business purpose is to serve our clients. Our deep roots in business centers around the world form a global network of relationships with key decision-makers in corporations, governments and investing institutions. This network is both a competitive strength and a powerful resource for Lazard and our clients. As a firm that competes on the quality of our advice, we have two fundamental assets: our people and our reputation.

We operate in cyclical businesses across multiple geographies, industries and asset classes. In recent years, we have expanded our geographic reach, bolstered our industry expertise and continued to build in growth areas. Companies, government bodies and investors seek independent advice with a geographic perspective, deep understanding of capital structure, informed research and knowledge of global, regional and local economic conditions. We believe that our business model as an independent advisor will continue to create opportunities for us to attract new clients and key personnel.

Our principal sources of revenue are derived from activities in the following business segments:

• Financial Advisory, which offers corporate, partnership, institutional, government, sovereign and individual clients across the globe a wide array of financial advisory services regarding M&A, capital advisory, restructurings, shareholder advisory, sovereign advisory, capital raising and other strategic advisory, and

• Asset Management, which offers a broad range of global investment solutions and investment management services in equity and fixed income strategies, asset allocation strategies, alternative investments and private equity funds to corporations, public funds, sovereign entities, endowments and foundations, labor funds, financial intermediaries and private clients.

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In addition, we record selected other activities in our Corporate segment, including management of cash, investments, deferred tax assets, outstanding indebtedness, certain contingent obligations, and assets and liabilities associated with Lazard Group’s Paris-based subsidiary, Lazard Frères Banque SA (“LFB”).

Our consolidated net revenue was derived from the following segments:

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2019			2018			2019			2018
Financial Advisory		52	%		56	%		52	%		55	%
Asset Management		50			47			48			47
Corporate		(2	)		(3	)		-			(2	)
Total		100	%		100	%		100	%		100	%

We also invest our own capital from time to time, generally alongside capital of qualified institutional and individual investors in alternative investments or private equity investments, and, since 2005, we have engaged in a number of alternative investments and private equity activities, including, historically, investments through (i) Edgewater, our Chicago-based private equity firm and (ii) a fund targeting significant noncontrolling-stake investments in established private companies. We also make investments to seed our Asset Management strategies.

Business Environment and Outlook

Economic and global financial market conditions can materially affect our financial performance. As described above, our principal sources of revenue are derived from activities in our Financial Advisory and Asset Management business segments. As our Financial Advisory revenues are primarily dependent on the successful completion of merger, acquisition, restructuring, capital raising or similar transactions, and our Asset Management revenues are primarily driven by the levels of AUM, weak economic and global financial market conditions can result in a challenging business environment for M&A and capital-raising activity as well as our Asset Management business, but may provide opportunities for our restructuring business.

On an ongoing basis, regional, macroeconomic and geopolitical factors, including trade policy and regional tax and regulatory reform, may impact our business. The U.S. economic expansion continues. The European economy’s growth rate remains low. Emerging markets as a group have experienced growth but also significant volatility. Global borrowing costs remain low.

Our outlook with respect to our Financial Advisory and Asset Management businesses is described below.

• Financial Advisory—The fundamentals for continued M&A activity appear to remain in place. We believe our Financial Advisory business is in a strong competitive position as demand continues for expert, independent strategic advice that can be levered across geographies and our range of capabilities. The global scale and breadth of our Financial Advisory business allows us to advise on a wide range of strategic and restructuring transactions across a variety of industries. In addition, we believe our businesses throughout the emerging markets position us for growth in these markets, while enhancing our relationships with, and the services that we can provide to, clients in other economies. We continue to invest for growth in our Financial Advisory business and to hire talented senior professionals selectively.

• Asset Management—In the short to intermediate term, we expect most investor demand will come from defined benefit and defined contribution plans in developed economies because of their sheer scope and size. Over the longer term, and depending upon local market conditions, we would expect an increasing share of our AUM to come from the developing economies around the globe, as their retirement systems evolve and individual wealth is increasingly deployed in the financial markets. Given our diversified investment platform and our ability to provide investment solutions for a global mix of clients, we believe we are positioned to benefit from opportunities across the asset management industry. We are continually developing and seeding new investment strategies that extend our existing platforms and assessing potential product acquisitions or other inorganic growth opportunities. Recent examples of growth initiatives include the following investment strategies: various Quantitative Equity strategies, an International Value strategy, a Global Equity Franchise strategy, a U.S. Systematic Equity strategy, and a Market Neutral Quantitative Equity strategy.

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We operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge continuously, and it is not possible for our management to predict all risks and uncertainties, nor can we assess the impact of all potentially applicable factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. See Item 1A, “Risk Factors” in our Form 10-K. Furthermore, net income and revenue in any period may not be indicative of full-year results or the results of any other period and may vary significantly from year to year and quarter to quarter.

Overall, we continue to focus on the development of our business, including the generation of stable revenue growth, earnings growth and shareholder returns, the evaluation of potential growth opportunities, the investment in new technology to support the development of existing and new business opportunities, the prudent management of our costs and expenses, the efficient use of our assets and the return of capital to our shareholders.

Certain data with respect to our Financial Advisory and Asset Management businesses is included below.

Financial Advisory

As reflected in the following table, which sets forth global M&A industry statistics, the value and number of all completed transactions, including the subset of completed transactions involving values greater than $500 million, decreased in the first half of 2019 as compared to 2018. With respect to announced M&A transactions, the value and number of all transactions, including the subset of announced transactions involving values greater than $500 million, decreased in the first half of 2019 as compared to 2018.

	Three Months Ended							Six Months Ended
	June 30,							June 30,
	2019		2018		% Incr / (Decr)			2019		2018		% Incr / (Decr)
	($ in billions)
Completed M&A Transactions:
All deals:
Value	$	772	$	1,109		(30	)%	$	1,677	$	2,054		(18	)%
Number		7,645		9,170		(17	)%		15,735		18,757		(16	)%
Deals Greater than $500 million:
Value	$	589	$	891		(34	)%	$	1,304	$	1,617		(19	)%
Number		239		327		(27	)%		515		640		(20	)%
Announced M&A Transactions:
All deals:
Value	$	1,137	$	1,172		(3	)%	$	2,171	$	2,359		(8	)%
Number		8,160		9,291		(12	)%		16,449		18,881		(13	)%
Deals Greater than $500 million:
Value	$	924	$	950		(3	)%	$	1,764	$	1,918		(8	)%
Number		324		390		(17	)%		571		705		(19	)%

Source: Dealogic as of July 4, 2019.

Global restructuring activity during the first half of 2019, as measured by the number of corporate defaults, remained unchanged as compared to the first half of 2018. The number of defaulting issuers was 46 in both the first half of 2019 and the first half of 2018 according to Moody’s Investors Service, Inc.

Net revenue trends in Financial Advisory are generally correlated to the level of completed industry-wide M&A transactions and restructuring transactions occurring subsequent to corporate debt defaults, respectively. However, deviations from this relationship can occur in any given year for a number of reasons. For instance, our results can diverge from industry-wide activity where there are material variances from the level of industry-wide M&A activity in a particular market where Lazard has significant market share, or regarding the relative number of our advisory engagements with respect to larger-sized transactions, and where we are involved in non-public or sovereign advisory assignments.

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Asset Management

Equity market indices for major markets at June 30, 2019 generally increased as compared to such indices at December 31, 2018 and June 30, 2018. The percentage change in major equity market indices at June 30, 2019, as compared to such indices at March 31, 2019, December 31, 2018, and at June 30, 2018, is shown in the table below.

	Percentage Changes June 30, 2019 vs.
	March 31, 2019			December 31, 2018			June 30, 2018
MSCI World Index		4	%		17	%		7	%
Euro Stoxx		6	%		19	%		6	%
MSCI Emerging Market		1	%		11	%		2	%
S&P 500		4	%		19	%		10	%

The fees that we receive for providing investment management and advisory services are primarily driven by the level of AUM and the nature of the AUM product mix. Accordingly, market movements, foreign currency exchange rate volatility and changes in our AUM product mix will impact the level of revenues we receive from our Asset Management business when comparing periodic results. A substantial portion of our AUM is invested in equities. Movements in AUM during the period generally reflect the changes in equity market indices.

Financial Statement Overview

Net Revenue

The majority of Lazard’s Financial Advisory net revenue historically has been earned from the successful completion of M&A transactions, capital advisory services, capital raising, restructuring, shareholder advisory, sovereign advisory and other strategic advisory matters. The main drivers of Financial Advisory net revenue are overall M&A activity, the level of corporate debt defaults and the environment for capital raising activities, particularly in the industries and geographic markets in which Lazard focuses. In some client engagements, often those involving financially distressed companies, revenue is earned in the form of retainers and similar fees that are contractually agreed upon with each client for each assignment and are not necessarily linked to the completion of a transaction. In addition, Lazard also earns fees from providing strategic advice to clients, with such fees not being dependent on a specific transaction, and may also earn fees in connection with public and private securities offerings. Significant fluctuations in Financial Advisory net revenue can occur over the course of any given year, because a significant portion of such net revenue is earned upon the successful completion of a transaction, restructuring or capital raising activity, the timing of which is uncertain and is not subject to Lazard’s control.

Lazard’s Asset Management segment principally includes Lazard Asset Management LLC (together with its subsidiaries, “LAM”), Lazard Frères Gestion SAS (“LFG”) and Edgewater. Asset Management net revenue is derived from fees for investment management and advisory services provided to clients. As noted above, the main driver of Asset Management net revenue is the level and product mix of AUM, which is generally influenced by the performance of the global equity markets and, to a lesser extent, fixed income markets as well as Lazard’s investment performance, which impacts its ability to successfully attract and retain assets. As a result, fluctuations (including timing thereof) in financial markets and client asset inflows and outflows have a direct effect on Asset Management net revenue and operating income. Asset Management fees are generally based on the level of AUM measured daily, monthly or quarterly, and an increase or reduction in AUM, due to market price fluctuations, currency fluctuations, changes in product mix, or net client asset flows will result in a corresponding increase or decrease in management fees. The majority of our investment advisory contracts are generally terminable at any time or on notice of 30 days or less. Institutional and individual clients, and firms with which we have strategic alliances, can terminate their relationship with us, reduce the aggregate amount of AUM or shift their funds to other types of accounts with different rate structures for a number of reasons, including investment performance, changes in prevailing interest rates and financial market performance. In addition, as Lazard’s AUM includes significant amounts of assets that are denominated in currencies other than U.S. Dollars, changes in the value of the U.S. Dollar relative to foreign currencies will impact the value of Lazard’s AUM and the overall amount of management fees generated by the AUM. Fees vary with the type of assets managed and the vehicle in which they are managed, with higher fees earned on equity assets and alternative investment funds, such as hedge funds and private equity funds, and lower fees earned on fixed income and cash management products.

The Company earns performance-based incentive fees on various investment products, including traditional products and alternative investment funds, such as hedge funds and private equity funds.

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For hedge funds, incentive fees are calculated based on a specified percentage of a fund’s net appreciation, in some cases in excess of established benchmarks or thresholds. The Company records incentive fees on traditional products and hedge funds at the end of the relevant performance measurement period, when potential uncertainties regarding the ultimate realizable amounts have been determined. The incentive fee measurement period is generally an annual period (unless an account terminates or redemption occurs during the year). The incentive fees received at the end of the measurement period are not subject to reversal or payback. Incentive fees on hedge funds are often subject to loss carryforward provisions in which losses incurred by the hedge funds in any year are applied against certain gains realized by the hedge funds in future periods before any incentive fees can be earned.

For private equity funds, incentive fees may be earned in the form of a “carried interest” if profits arising from realized investments exceed a specified threshold. Typically, such carried interest is ultimately calculated on a whole-fund basis and, therefore, clawback of carried interest during the life of the fund can occur. As a result, incentive fees earned on our private equity funds are not recognized until potential uncertainties regarding the ultimate realizable amounts have been determined, including any potential for clawback.

Corporate segment net revenue consists primarily of investment gains and losses on the Company’s “seed investments” related to our Asset Management business and principal investments in private equity funds, net of hedging activities, as well as gains and losses on investments held in connection with Lazard Fund Interests (“LFI”) and interest income and interest expense. Corporate net revenue also can fluctuate due to changes in the fair value of equity securities and investments classified as “trading”, as well as due to changes in interest and currency exchange rates and in the levels of cash, investments and indebtedness.

Although Corporate segment net revenue during 2019 is not significant compared to Lazard’s net revenue, total assets in the Corporate segment represented 69% of Lazard’s consolidated total assets as of June 30, 2019, which are attributable to cash and cash equivalents, investments in debt and equity securities, interests in alternative investment, debt, equity and private equity funds, deferred tax assets and certain assets associated with LFB.

Operating Expenses

The majority of Lazard’s operating expenses relate to compensation and benefits for managing directors and employees. Our compensation and benefits expense includes (i) salaries and benefits, (ii) amortization of the relevant portion of previously granted deferred incentive compensation awards, including (a) share-based incentive compensation under the Lazard Ltd 2018 Incentive Compensation Plan (the “2018 Plan”) and the Lazard Ltd 2008 Incentive Compensation Plan (the “2008 Plan”), and (b) LFI and other similar deferred compensation arrangements (see Note 14 of Notes to Condensed Consolidated Financial Statements), (iii) a provision for discretionary or guaranteed cash bonuses and profit pools and (iv) when applicable, severance payments. Compensation expense in any given period is dependent on many factors, including general economic and market conditions, our actual and forecasted operating and financial performance, staffing levels, estimated forfeiture rates, competitive pay conditions and the nature of revenues earned, as well as the mix between current and deferred compensation.

For interim periods, we use “adjusted compensation and benefits expense” and the ratio of “adjusted compensation and benefits expense” to “operating revenue,” both non-GAAP measures, for comparison of compensation and benefits expense between periods. For the reconciliations and calculations with respect to “adjusted compensation and benefits expense” and related ratios to “operating revenue,” see the table under “Consolidated Results of Operations” below.

We believe that “awarded compensation and benefits expense” and the ratio of “awarded compensation and benefits expense” to “operating revenue,” both non-GAAP measures, are the most appropriate measures to assess the annual cost of compensation and provide the most meaningful basis for comparison of compensation and benefits expense between present, historical and future years. “Awarded compensation and benefits expense” for a given year is calculated using “adjusted compensation and benefits expense,” also a non-GAAP measure, as modified by the following items:

• we deduct amortization expense recorded for accounting principles generally accepted in the United States of America (“U.S. GAAP”) purposes in the fiscal year associated with deferred incentive compensation awards;

• we add incentive compensation with respect to the fiscal year, which is comprised of:

(i) the deferred incentive compensation awards granted in the year-end compensation process with respect to the fiscal year (e.g., deferred incentive compensation awards granted in 2019 related to the 2018 year-end compensation process), including performance-based restricted stock unit (“PRSU”) and performance-based restricted participation unit (“PRPU”) awards (based on the target payout level);

47

(ii) the portion of investments in people (e.g., “sign-on” bonuses or retention awards) and other special deferred incentive compensation awards that is applicable to the fiscal year the award becomes effective; and

(iii) amounts in excess of the target payout level for PRSU and PRPU awards at the end of their respective performance periods; and

• we reduce the amounts in (i), (ii) and (iii) above by an estimate of future forfeitures with respect to such awards.

Compensation and benefits expense is the largest component of our operating expenses. We seek to maintain discipline with respect to compensation, including the rate at which we award deferred compensation. Our goal is to maintain a ratio of awarded compensation and benefits expense to operating revenue and a ratio of adjusted compensation and benefits expense to operating revenue over the cycle in the mid- to high-50s percentage range. While we have implemented policies and initiatives that we believe will assist us in maintaining ratios within this range, there can be no guarantee that we will continue to maintain such ratios, or that our policies or initiatives will not change, in the future. We may benefit from pressure on compensation costs within the financial services industry in future periods; however, increased competition for senior professionals, changes in the macroeconomic environment or the financial markets generally, lower operating revenue resulting from, for example, a decrease in M&A activity, our share of the M&A market or our AUM levels, changes in the mix of revenues from our businesses, investments in our businesses or various other factors could prevent us from achieving this goal.

Our operating expenses also include “non-compensation expense”, which includes costs for occupancy and equipment, marketing and business development, technology and information services, professional services, fund administration and outsourced services and other expenses. Our occupancy costs represent a significant portion of our aggregate operating expenses and are subject to change from time to time, particularly as leases for real property expire and are renewed or replaced with new, long-term leases for the same or other real property. In 2019, non-compensation expense included expenses related to the redemption of the Company’s 4.25% senior notes due 2020 (the “2020 Notes”).

We believe that “adjusted non-compensation expense”, a non-GAAP measure, provides a more meaningful basis for our investors to assess our operating results. For calculations with respect to “adjusted non-compensation expense”, see the table under “Consolidated Results of Operations” below.

Our operating expenses also include “amortization and other acquisition-related (benefits) costs” which includes the change in fair value of the contingent consideration associated with business acquisitions.

Provision for Income Taxes

Lazard Ltd, through its subsidiaries, is subject to U.S. federal income taxes on all of its U.S. operating income, as well as on the portion of non-U.S. income attributable to its U.S. subsidiaries. In addition, Lazard Ltd, through its subsidiaries, is subject to state and local taxes on its income apportioned to various state and local jurisdictions. Outside the U.S., Lazard Group operates principally through subsidiary corporations that are subject to local income taxes in foreign jurisdictions. Lazard Group is also subject to Unincorporated Business Tax (“UBT”) attributable to its operations apportioned to New York City.

See “Critical Accounting Policies and Estimates—Income Taxes” below and Notes 16 and 18 of Notes to Condensed Consolidated Financial Statements for additional information regarding income taxes, our deferred tax assets and the tax receivable agreement obligation.

Noncontrolling Interests

Noncontrolling interests primarily consist of amounts related to Edgewater’s management vehicles that the Company is deemed to control but not own, profits interest participation rights and consolidated VIE interests held by employees. See Notes 13 and 21 of Notes to Condensed Consolidated Financial Statements for information regarding the Company’s noncontrolling interests and consolidated VIEs.

Consolidated Results of Operations

Lazard’s condensed consolidated financial statements are presented in U.S. Dollars. Many of our non-U.S. subsidiaries have a functional currency (i.e., the currency in which operational activities are primarily conducted) that is other than the U.S. Dollar, generally the currency of the country in which the subsidiaries are domiciled. Such subsidiaries’ assets and liabilities are translated into U.S. Dollars using exchange rates as of the respective balance sheet date, while revenue and expenses are translated at average exchange rates during the respective periods based on the daily closing exchange rates. Adjustments that result from translating amounts from a subsidiary’s functional currency are reported as a component of stockholders’ equity. Foreign currency remeasurement gains and losses on transactions in non-functional currencies are included in the condensed consolidated statements of operations.

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A portion of our net revenue is derived from transactions that are denominated in currencies other than the U.S. Dollar. Net revenue for the three month and six month periods ended June 30, 2019 was negatively impacted by exchange rate movements in comparison to the relevant prior year period. The majority of the impact to net revenue was offset by the impact of the exchange rate movements on our operating expenses during the periods denominated in currencies other than the U.S. Dollar.

The condensed consolidated financial statements are prepared in conformity with U.S. GAAP. Selected financial data derived from the Company’s reported condensed consolidated results of operations is set forth below, followed by a more detailed discussion of both the consolidated and business segment results.

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2019			2018			2019			2018
	($ in thousands)
Net Revenue	$	630,690		$	757,938		$	1,274,364		$	1,512,636
Operating Expenses:
Compensation and benefits		372,470			416,159			744,724			821,206
Non-compensation		151,493			150,322			299,780			313,279
Amortization and other acquisition-related (benefits) costs		5,042			(8,483	)		8,512			(7,617	)
Total operating expenses		529,005			557,998			1,053,016			1,126,868
Operating Income		101,685			199,940			221,348			385,768
Provision for income taxes		28,172			51,561			51,359			75,728
Net Income		73,513			148,379			169,989			310,040
Less - Net Income Attributable to Noncontrolling Interests		7,736			1,416			7,170			3,385
Net Income Attributable to Lazard Ltd	$	65,777		$	146,963		$	162,819		$	306,655
Operating Income, as a % of net revenue		16.1	%		26.4	%		17.4	%		25.5	%

The tables below describe the components of operating revenue, adjusted compensation and benefits expense, adjusted non-compensation expense, earnings from operations and related key ratios, which are non-GAAP measures used by the Company to manage its business. We believe such non-GAAP measures provide the most meaningful basis for comparison between present, historical and future periods, as described above.

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2019			2018			2019			2018
	($ in thousands)
Operating Revenue:
Net revenue	$	630,690		$	757,938		$	1,274,364		$	1,512,636
Adjustments:
Interest expense (a)		18,722			12,605			35,511			25,137
Distribution fees, reimbursable deal costs and    bad debt expense (b)		(13,357	)		(24,718	)		(37,689	)		(64,232	)
Revenue related to noncontrolling interests (c)		(11,819	)		(5,622	)		(14,090	)		(10,839	)
(Gains) losses on investments pertaining to LFI (d)		(6,484	)		499			(20,354	)		1,935
Private equity investment adjustment (e)		11,948			-			11,948			-
Operating revenue	$	629,700		$	740,702		$	1,249,690		$	1,464,637

(a) Interest expense (excluding interest expense incurred by LFB) is added back in determining operating revenue because such expense relates to corporate financing activities and is not considered to be a cost directly related to the revenue of our business.

(b) Represents certain distribution fees, reimbursable deal costs paid to third parties and bad debt expense relating to fees that are deemed uncollectible for which an equal amount is excluded for purposes of determining adjusted non-compensation expense.

(c) Revenue related to the consolidation of noncontrolling interests is excluded from operating revenue because the Company has no economic interest in such amount.

(d) Represents changes in the fair value of investments held in connection with LFI and other similar deferred compensation arrangements for which a corresponding equal amount is excluded from compensation and benefits expense.

(e) Represents write-down of a private equity investment to the potential transaction value.

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	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2019			2018			2019			2018
	($ in thousands)
Adjusted Compensation and Benefits Expense:
Total compensation and benefits expense	$	372,470		$	416,159		$	744,724		$	821,206
Adjustments:
Noncontrolling interests (a)		(3,908	)		(3,346	)		(5,798	)		(5,873	)
(Charges) credits pertaining to LFI (b)		(6,484	)		499			(20,354	)		1,935
Adjusted compensation and benefits expense	$	362,078		$	413,312		$	718,572		$	817,268
Adjusted compensation and benefits expense, as a % of operating    revenue		57.5	%		55.8	%		57.5	%		55.8	%

(a) Expenses related to the consolidation of noncontrolling interests are excluded because Lazard has no economic interest in such amounts.

(b) Represents changes in fair value of the compensation liability recorded in connection with LFI and other similar deferred incentive compensation awards for which a corresponding equal amount is excluded from operating revenue.

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2019			2018			2019			2018
	($ in thousands)
Adjusted Non-Compensation Expense:
Total non-compensation expense	$	151,493		$	150,322		$	299,780		$	313,279
Adjustments:
Expenses associated with ERP system implementation (a)		(7,626	)		(5,404	)		(10,831	)		(12,830	)
Expenses related to office space reorganization (b)		-			(1,036	)		-			(2,425	)
Distribution fees, reimbursable deal costs and    bad debt expense (c)		(13,357	)		(24,718	)		(37,689	)		(64,232	)
Charges pertaining to senior debt refinancing (d)		(2,262	)		-			(6,505	)		-
Noncontrolling interests (e)		(234	)		(683	)		(1,004	)		(1,230	)
Adjusted non-compensation expense	$	128,014		$	118,481		$	243,751		$	232,562
Adjusted non-compensation expense, as a % of operating  revenue		20.3	%		16.0	%		19.5	%		15.9	%

(a) Represents expenses associated with the Enterprise Resource Planning (“ERP”) system implementation.

(b) Represents incremental rent expense and lease abandonment costs related to office space reorganization.

(c) Represents certain distribution fees, reimbursable deal costs paid to third parties and bad debt expense relating to fees that are deemed uncollectible for which an equal amount is included for purposes of determining operating revenue.

(d) In 2019, represents charges pertaining to the redemption of the Company’s 2020 Notes due to the non-operating nature of such transaction. See “—Liquidity and Capital Resources—Financing Activities” below.

(e) Expenses related to the consolidation of noncontrolling interests are excluded because the Company has no economic interest in such amounts.

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2019			2018			2019			2018
	($ in thousands)
Earnings From Operations:
Operating revenue	$	629,700		$	740,702		$	1,249,690		$	1,464,637
Deduct:
Adjusted compensation and benefits expense		(362,078	)		(413,312	)		(718,572	)		(817,268	)
Adjusted non-compensation expense		(128,014	)		(118,481	)		(243,751	)		(232,562	)
Earnings from operations	$	139,608		$	208,909		$	287,367		$	414,807
Earnings from operations, as a % of operating revenue		22.2	%		28.2	%		23.0	%		28.3	%

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Headcount information is set forth below:

	As of
	June 30, 2019		December 31, 2018		June 30, 2018
Headcount:
Managing Directors:
Financial Advisory		177		166		166
Asset Management		111		102		101
Corporate		17		17		17
Total Managing Directors		305		285		284
Other Business Segment Professionals and Support Staff:
Financial Advisory		1,364		1,312		1,266
Asset Management		1,012		1,014		963
Corporate		393		385		383
Total		3,074		2,996		2,896

Operating Results

The Company’s quarterly revenue and profits can fluctuate materially depending on the number, size and timing of completed transactions on which it advised, as well as seasonality, the performance of equity markets and other factors. Accordingly, the revenue and profits in any particular quarter may not be indicative of future results. Lazard management believes that annual results are the most meaningful basis for comparison among present, historical and future periods.

Three Months Ended June 30, 2019 versus June 30, 2018

The Company reported net income attributable to Lazard Ltd of $66 million, as compared to net income attributable to Lazard Ltd of $147 million in the 2018 period.

Net revenue decreased $127 million, or 17%, with operating revenue decreasing $111 million, or 15%, as compared to the 2018 period. Fee revenue from investment banking and other advisory activities decreased $93 million, or 22%, as compared to the 2018 period. Asset management fees, including incentive fees, decreased $39 million, or 12%, as compared to the 2018 period, primarily due to a decrease in average AUM. In the aggregate, interest income, other revenue and interest expense increased $5 million, as compared to the 2018 period.

Compensation and benefits expense decreased $44 million, or 10%, as compared to the 2018 period, primarily associated with decreased operating revenue.

Adjusted compensation and benefits expense (which excludes certain items and which we believe allows for improved comparability between periods, as described above) was $362 million, a decrease of $51 million, or 12%, as compared to $413 million in the 2018 period. The ratio of adjusted compensation and benefits expense to operating revenue was 57.5% for the 2019 period, as compared to 55.8% for the 2018 period.

Non-compensation expense increased $1 million, or 1%, as compared to the 2018 period. Adjusted non-compensation expense increased $10 million, or 8%, as compared to the 2018 period mainly reflecting investments in our technology infrastructure. The ratio of adjusted non-compensation expense to operating revenue was 20.3% for the 2019 period, as compared to 16.0% for the 2018 period.

Amortization and other acquisition-related (benefits) costs reflects a cost of $5 million in the 2019 period as compared to a benefit of $8 million in the 2018 period primarily due to the change in the fair market value of contingent consideration.

Operating income decreased $98 million, or 49%, as compared to the 2018 period.

Earnings from operations decreased $69 million, or 33%, as compared to the 2018 period, and, as a percentage of operating revenue, was 22.2%, as compared to 28.2% in the 2018 period.

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The provision for income taxes reflects an effective tax rate of 27.7%, as compared to 25.8% for the 2018 period. The increase in the effective tax rate is primarily due to a reduction in excess net tax benefits related to share-based incentive compensation and the impact of U.S. tax reform primarily related to base erosion and anti-abuse tax, partially offset by a change in the geographic mix of earnings.  

Net income attributable to noncontrolling interests increased $6 million as compared to the 2018 period.

Six Months Ended June 30, 2019 versus June 30, 2018

The Company reported net income attributable to Lazard Ltd of $163 million, as compared to net income attributable to Lazard Ltd of $307 million in the 2018 period.

Net revenue decreased $238 million, or 16%, with operating revenue decreasing $215 million, or 15%, as compared to the 2018 period. Fee revenue from investment banking and other advisory activities decreased $165 million, or 20%, as compared to the 2018 period. Asset management fees, including incentive fees, decreased $85 million, or 13%, as compared to the 2018 period, primarily due to a decrease in average AUM. In the aggregate, interest income, other revenue and interest expense increased $12 million, as compared to the 2018 period, primarily due to higher income attributable to investments held in connection with LFI.

Compensation and benefits expense decreased $76 million, or 9%, as compared to the 2018 period, primarily associated with decreased operating revenue.

Adjusted compensation and benefits expense (which excludes certain items and which we believe allows for improved comparability between periods, as described above) was $719 million, a decrease of $99 million, or 12%, as compared to $817 million in the 2018 period. The ratio of adjusted compensation and benefits expense to operating revenue was 57.5% for the 2019 period, as compared to 55.8% for the 2018 period.

Non-compensation expense decreased $13 million, or 4%, as compared to the 2018 period, primarily due to higher bad debt expense in the 2018 period and lower fund administration fees in the 2019 period, partially offset by investments in our technology infrastructure in the 2019 period. Adjusted non-compensation expense increased $11 million, or 5%, as compared to the 2018 period. The ratio of adjusted non-compensation expense to operating revenue was 19.5% for the 2019 period, as compared to 15.9% in the 2018 period.

Amortization and other acquisition-related (benefits) costs reflects a cost of $9 million in the 2019 period, as compared to a benefit of $8 million in the 2018 period, primarily due to the change in the fair market value of contingent consideration.

Operating income decreased $164 million, or 43%, as compared to the 2018 period.

Earnings from operations decreased $127 million, or 31%, as compared to the 2018 period, and, as a percentage of operating revenue, was 23.0%, as compared to 28.3% in the 2018 period.

The provision for income taxes reflects an effective tax rate of 23.2%, as compared to 19.6% for the 2018 period. The increase in the effective tax rate is primarily due to a reduction in excess net tax benefits related to share-based incentive compensation and the impact of U.S. tax reform primarily related to base erosion and anti-abuse tax.

Net income attributable to noncontrolling interests increased $4 million as compared to the 2018 period.

Business Segments

The following is a discussion of net revenue and operating income for the Company’s segments: Financial Advisory, Asset Management and Corporate. Each segment’s operating expenses include (i) compensation and benefits expenses that are incurred directly in support of the segment and (ii) other operating expenses, which include directly incurred expenses for occupancy and equipment, marketing and business development, technology and information services, professional services, fund administration and outsourcing, and indirect support costs (including compensation and benefits expense and other operating expenses related thereto) for administrative services. Such administrative services include, but are not limited to, accounting, tax, human resources, legal, information technology, facilities management and senior management activities. Such support costs are allocated to the relevant segments based on various statistical drivers such as revenue, headcount, square footage and other factors.

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Financial Advisory

The following table summarizes the reported operating results attributable to the Financial Advisory segment:

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2019			2018			2019			2018
	($ in thousands)
Net Revenue	$	329,612		$	422,089		$	667,982		$	831,210
Operating Expenses		276,238			318,177			556,499			642,873
Operating Income	$	53,374		$	103,912		$	111,483		$	188,337
Operating Income, as a % of net revenue		16.2	%		24.6	%		16.7	%		22.7	%

Certain Lazard fee and transaction statistics for the Financial Advisory segment are set forth below:

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2019			2018			2019			2018
Lazard Statistics:
Number of clients with fees greater than $1 million:
Financial Advisory		69			88			131			159
Percentage of total Financial Advisory net revenue from top 10    clients		39	%		33	%		26	%		24	%
Number of M&A transactions completed with values greater than    $500 million (a)		12			20			32			49

(a) Source: Dealogic as of July 4, 2019.

The geographical distribution of Financial Advisory net revenue is set forth below in percentage terms and is based on the Lazard offices that generate Financial Advisory net revenue, which are located in the Americas (primarily in the U.S., Canada and Latin America), EMEA (primarily in the U.K., France, Germany, Italy and Spain) and the Asia Pacific region (primarily in Australia) and therefore may not be reflective of the geography in which the clients are located.

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2019			2018			2019			2018
Americas		73	%		57	%		69	%		54	%
EMEA		26			38			29			40
Asia Pacific		1			5			2			6
Total		100	%		100	%		100	%		100	%

The Company’s managing directors and many of its professionals have significant experience, and many of them are able to use this experience to advise on M&A, restructuring and other strategic advisory matters, depending on clients’ needs. This flexibility allows Lazard to better match its professionals with the counter-cyclical business cycles of mergers and acquisitions and restructurings. While Lazard measures revenue by practice area, Lazard does not separately measure the costs or profitability of M&A services as compared to restructuring or other services. Accordingly, Lazard measures performance in its Financial Advisory segment based on overall segment operating revenue and operating income margins.

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Financial Advisory Results of Operations

Financial Advisory’s quarterly revenue and profits can fluctuate materially depending on the number, size and timing of completed transactions on which it advised, as well as seasonality and other factors. Accordingly, the revenue and profits in any particular quarter or period may not be indicative of future results. Lazard management believes that annual results are the most meaningful basis for comparison among present, historical and future periods.

Three Months Ended June 30, 2019 versus June 30, 2018

Financial Advisory net revenue decreased $92 million, or 22%, as compared to the 2018 period.

Operating expenses decreased $42 million, or 13%, as compared to the 2018 period, primarily due to a decrease in compensation and benefits expense associated with decreased operating revenue.

Financial Advisory operating income was $53 million, a decrease of $51 million, or 49%, as compared to operating income of $104 million in the 2018 period and, as a percentage of net revenue, was 16.2%, as compared to 24.6% in the 2018 period.

Six Months Ended June 30, 2019 versus June 30, 2018

Financial Advisory net revenue decreased $163 million, or 20%, as compared to the 2018 period. The decrease in Financial Advisory revenue was primarily a result of a decrease in the number of fees greater than $5 million, as compared to the 2018 period.

Operating expenses decreased $86 million, or 13%, as compared to the 2018 period, primarily due to a decrease in compensation associated with decreased operating revenue.

Financial Advisory operating income was $111 million, a decrease of $77 million, or 41%, as compared to operating income of $188 million in the 2018 period and, as a percentage of net revenue, was 16.7%, as compared to 22.7% in the 2018 period.

Asset Management

The following table shows the composition of AUM for the Asset Management segment:

	As of
	June 30, 2019		December 31, 2018
	($ in millions)
AUM by Asset Class:
Equity:
Emerging Markets	$	42,836	$	41,899
Global		47,559		41,490
Local		40,575		36,020
Multi-Regional		64,888		57,589
Total Equity		195,858		176,998
Fixed Income:
Emerging Markets		15,692		14,980
Global		6,195		4,851
Local		5,767		6,113
Multi-Regional		8,935		6,994
Total Fixed Income		36,589		32,938
Alternative Investments		2,492		2,430
Private Equity		1,383		1,469
Cash Management		1,144		899
Total AUM	$	237,466	$	214,734

Total AUM at June 30, 2019 was $237 billion, an increase of $22 billion, or 11%, as compared to total AUM of $215 billion at December 31, 2018, due to market appreciation, partially offset by net outflows and foreign exchange depreciation. Average AUM for the three month and six month periods ended June 30, 2019 decreased 3% and 7% as compared to the three month and six month periods ended June 30, 2018, respectively.

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As of June 30, 2019, approximately 86% of our AUM was managed on behalf of institutional clients, including corporations, labor unions, public pension funds, insurance companies and banks, and through sub-advisory relationships, mutual fund sponsors, broker-dealers and registered advisors, as compared to approximately 88% as of December 31, 2018. As of June 30, 2019, approximately 14% of our AUM was managed on behalf of individual client relationships, which are principally with family offices and individuals, as compared to 12% as of December 31, 2018.

As of June 30, 2019, AUM with foreign currency exposure represented approximately 69% of our total AUM, as compared to approximately 70%  as of December 31, 2018. AUM with foreign currency exposure generally declines in value with the strengthening of the U.S. Dollar and increases in value as the U.S. Dollar weakens, with all other factors held constant.

The following is a summary of changes in AUM by asset class for the three month and six month periods ended June 30, 2019 and 2018:

	Three Months Ended June 30, 2019
	AUM Beginning Balance		Inflows (a)		Outflows (a)			Net Flows			Market Value Appreciation/ (Depreciation)		Foreign Exchange Appreciation/ (Depreciation)		AUM Ending Balance
	($ in millions)
Equity	$	195,095	$	5,232	$	(11,389	)	$	(6,157	)	$	6,393	$	527	$	195,858
Fixed Income		35,008		2,345		(1,312	)		1,033			255		293		36,589
Other		4,876		278		(400	)		(122	)		254		11		5,019
Total	$	234,979	$	7,855	$	(13,101	)	$	(5,246	)	$	6,902	$	831	$	237,466

(a) Inflows in the Equity asset class were primarily attributable to the Global, Emerging Markets and Multi-Regional platforms, and inflows in the Fixed Income asset class were primarily attributable to the Global and Multi-Regional platforms. Outflows in the Equity asset class were primarily attributable to the Emerging Markets, Global, and Multi-Regional platforms, and outflows in the Fixed Income asset class were primarily attributable to the Emerging Markets and Global platforms.

	Six Months Ended June 30, 2019
	AUM Beginning Balance		Inflows (a)		Outflows (a)			Net Flows			Market Value Appreciation/ (Depreciation)		Foreign Exchange Appreciation/ (Depreciation)			AUM Ending Balance
	($ in millions)
Equity	$	176,998	$	11,630	$	(18,618	)	$	(6,988	)	$	25,957	$	(109	)	$	195,858
Fixed Income		32,938		4,963		(3,196	)		1,767			1,823		61			36,589
Other		4,798		797		(784	)		13			210		(2	)		5,019
Total	$	214,734	$	17,390	$	(22,598	)	$	(5,208	)	$	27,990	$	(50	)	$	237,466

(a) Inflows in the Equity asset class were primarily attributable to the Global, Emerging Markets and Multi-Regional platforms, and inflows in the Fixed Income asset class were primarily attributable to the Global, Multi-Regional and Emerging Markets platforms. Outflows in the Equity asset class were primarily attributable to the Emerging Markets, Global and Multi-Regional platforms, and outflows in the Fixed Income asset class were primarily attributable to the Emerging Markets and Global platforms.

	Three Months Ended June 30, 2018
	AUM Beginning Balance		Inflows		Outflows			Net Flows			Market Value Appreciation/ (Depreciation)			Foreign Exchange Appreciation/ (Depreciation)			AUM Ending Balance
	($ in millions)
Equity	$	210,077	$	6,782	$	(10,399	)	$	(3,617	)	$	(1,102	)	$	(6,517	)	$	198,841
Fixed Income		36,656		1,364		(1,615	)		(251	)		(763	)		(1,577	)		34,065
Other		4,947		146		(124	)		22			39			(38	)		4,970
Total	$	251,680	$	8,292	$	(12,138	)	$	(3,846	)	$	(1,826	)	$	(8,132	)	$	237,876

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	Six Months Ended June 30, 2018
	AUM Beginning Balance		Inflows		Outflows			Net Flows			Market Value Appreciation/ (Depreciation)			Foreign Exchange Appreciation/ (Depreciation)			AUM Ending Balance
	($ in millions)
Equity	$	209,358	$	17,708	$	(20,453	)	$	(2,745	)	$	(3,302	)	$	(4,470	)	$	198,841
Fixed Income		35,080		4,055		(2,693	)		1,362			(1,299	)		(1,078	)		34,065
Other		5,021		305		(361	)		(56	)		(23	)		28			4,970
Total	$	249,459	$	22,068	$	(23,507	)	$	(1,439	)	$	(4,624	)	$	(5,520	)	$	237,876

As of July 19, 2019, AUM was $237.4 billion, a $0.1 billion decrease since June 30, 2019. The decrease in AUM was due to foreign exchange depreciation of $0.9 billion and net outflows of $0.8 billion, partially offset by market appreciation of $1.6 billion.

Average AUM for the three month and six month periods ended June 30, 2019 and 2018 for each significant asset class is set forth below. Average AUM generally represents the average of the monthly ending AUM balances for the period.

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2019		2018		2019		2018
	($ in millions)
Average AUM by Asset Class:
Equity	$	196,171	$	205,221	$	192,555	$	209,777
Fixed Income		35,669		34,975		35,148		35,911
Alternative Investments		2,606		2,797		2,649		2,857
Private Equity		1,391		1,457		1,404		1,460
Cash Management		1,141		677		984		609
Total Average AUM	$	236,978	$	245,127	$	232,740	$	250,614

The following table summarizes the reported operating results attributable to the Asset Management segment:

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2019			2018			2019			2018
	($ in thousands)
Net Revenue	$	315,591		$	352,588		$	617,424		$	706,871
Operating Expenses		219,021			229,561			426,369			459,230
Operating Income	$	96,570		$	123,027		$	191,055		$	247,641
Operating Income, as a % of net revenue		30.6	%		34.9	%		30.9	%		35.0	%

The geographical distribution of Asset Management net revenue is set forth below in percentage terms, and is based on the Lazard offices that manage and distribute the respective AUM amounts. Such geographical distribution may not be reflective of the geography of the investment products or clients.

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2019			2018			2019			2018
Americas		57	%		57	%		56	%		56	%
EMEA		32			34			33			34
Asia Pacific		11			9			11			10
Total		100	%		100	%		100	%		100	%

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Asset Management Results of Operations

Asset Management’s quarterly revenue and profits in any particular quarter or period may not be indicative of future results and may fluctuate based on the performance of the equity and other capital markets. Lazard management believes that annual results are the most meaningful basis for comparison among present, historical and future periods.

Three Months Ended June 30, 2019 versus June 30, 2018

Asset Management net revenue decreased $37 million, or 10%, as compared to the 2018 period. Management fees and other revenue was $311 million, a decrease of $30 million, or 9%, as compared to $341 million in the 2018 period, primarily due a decrease in average AUM. Incentive fees were $5 million, a decrease of $7 million as compared to $12 million in the 2018 period.

Operating expenses decreased $11 million, or 5%, as compared to the 2018 period, primarily due to a decrease in compensation and benefits expense associated with decreased operating revenue, as well as lower fund administration fees.

Asset Management operating income was $97 million, a decrease of $26 million, or 22%, as compared to operating income of $123 million in the 2018 period and, as a percentage of net revenue, was 30.6%, as compared to 34.9% in the 2018 period.

Six Months Ended June 30, 2019 versus June 30, 2018

Asset Management net revenue decreased $89 million, or 13%, as compared to the 2018 period. Management fees and other revenue was $612 million, a decrease of $77 million, or 11%, as compared to $689 million in the 2018 period, primarily due to a decrease in average AUM. Incentive fees were $6 million, a decrease of $12 million as compared to $18 million in the 2018 period.

Operating expenses decreased $33 million, or 7%, as compared to the 2018 period, primarily due to a decrease in compensation and benefits expense associated with decreased operating revenue, as well as lower fund administration fees.

Asset Management operating income was $191 million, a decrease of $57 million, or 23%, as compared to operating income of $248 million in the 2018 period and, as a percentage of net revenue, was 30.9%, as compared to 35.0% in the 2018 period.

Corporate

The following table summarizes the reported operating results attributable to the Corporate segment:

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2019			2018			2019			2018
	($ in thousands)
Interest Income	$	3,187		$	1,737		$	6,028		$	4,057
Interest Expense		(18,997	)		(12,603	)		(36,013	)		(25,615	)
Net Interest (Expense)		(15,810	)		(10,866	)		(29,985	)		(21,558	)
Other Revenue (Expense)		1,297			(5,873	)		18,943			(3,887	)
Net Revenue (Expense)		(14,513	)		(16,739	)		(11,042	)		(25,445	)
Operating Expenses		33,746			10,260			70,148			24,765
Operating Income (Loss)	$	(48,259	)	$	(26,999	)	$	(81,190	)	$	(50,210	)

Corporate Results of Operations

Corporate operating results in any particular quarter or period may not be indicative of future results and may fluctuate based on a variety of factors. Lazard management believes that annual results are the most meaningful basis for comparison among present, historical and future periods.

Three Months Ended June 30, 2019 versus June 30, 2018

Net interest expense increased $5 million, or 45%, as compared to the 2018 period.

Other revenue increased $7 million as compared to the 2018 period, primarily due to higher income in the 2019 period attributable to investments held in connection with LFI.

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Operating expenses increased $23 million as compared to the 2018 period, primarily due to an increase in compensation and benefits expense, including an increase in charges pertaining to LFI.

Six Months Ended June 30, 2019 versus June 30, 2018

Net interest expense increased $8 million, or 39%, as compared to the 2018 period.

Other revenue increased $23 million as compared to the 2018 period, primarily due to higher income in the 2019 period attributable to investments held in connection with LFI.

Operating expenses increased $45 million as compared to the 2018 period, primarily due to a increase in compensation and benefits expense, including an increase in charges pertaining to LFI.

Cash Flows

The Company’s cash flows are influenced primarily by the timing of the receipt of Financial Advisory and Asset Management fees, the timing of distributions to shareholders, payments of incentive compensation to managing directors and employees and purchases of Class A common stock. Cash flows were also affected in 2019 by Lazard Group’s issuance of $500 million aggregate principal amount of its 4.375% senior notes maturing in 2029 (the “2029 Notes”) and the redemption of the 2020 Notes.

M&A and other advisory and Asset Management fees are generally collected within 60 days of billing, while Restructuring fee collections may extend beyond 60 days, particularly those that involve bankruptcies with court-ordered holdbacks. Fees from our Private Capital Advisory activities are generally collected over a four-year period from billing and typically include an interest component.

The Company makes cash payments for, or in respect of, a significant portion of its incentive compensation during the first three months of each calendar year with respect to the prior year’s results. The Company also paid a special dividend in February 2019 and February 2018.

Summary of Cash Flows:

	Six Months Ended
	June 30,
	2019			2018
	($ in millions)
Cash Provided By (Used In):
Operating activities:
Net income	$	170		$	310
Adjustments to reconcile net income to net cash provided by operating activities (a)		292			256
Other operating activities (b)		(379	)		(501	)
Net cash provided by (used in) operating activities		83			65
Investing activities		(18	)		(31	)
Financing activities (c)		(87	)		(559	)
Effect of exchange rate changes		(9	)		(47	)
Net Decrease in Cash and Cash Equivalents and Restricted Cash		(31	)		(572	)
Cash and Cash Equivalents and Restricted Cash (d):
Beginning of Period		2,292			2,455
End of Period	$	2,261		$	1,883

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(a) Consists of the following:

	Six Months Ended
	June 30,
	2019		2018
	($ in millions)
Depreciation and amortization of property	$	16	$	17
Noncash lease expense		27		-
Amortization of deferred expenses and share-based incentive compensation		227		226
Deferred tax provision		7		21
Amortization and other acquisition-related (benefits) costs		8		(8	)
Loss on extinguishment of debt		7		-
Total	$	292	$	256

(b) Includes net changes in operating assets and liabilities.

(c) Consists primarily of purchases of shares of Class A common stock, tax withholdings related to the settlement of vested restricted stock units (“RSUs”), vested restricted stock awards and vested PRSUs, Class A common stock dividends, changes in customer deposits, distributions to noncontrolling interest holders and activity relating to borrowings (including in 2019, the redemption of the 2020 Notes and the issuance of the 2029 Notes).

(d) Cash and cash equivalents and restricted cash consists of cash and cash equivalents, deposits with banks and short-term investments and cash deposited with clearing organizations and other segregated cash.

Liquidity and Capital Resources

The Company’s liquidity and capital resources are derived from operating activities, financing activities and equity offerings.

Operating Activities

Net revenue, operating income and cash receipts fluctuate significantly between periods. In the case of Financial Advisory, fee receipts are generally dependent upon the successful completion of client transactions, the occurrence and timing of which is irregular and not subject to Lazard’s control.

Liquidity is significantly impacted by cash payments for, or in respect of, incentive compensation, a significant portion of which are made during the first three months of the year. As a consequence, cash on hand generally declines in the beginning of the year and gradually builds over the remainder of the year. We also pay certain tax advances during the year on behalf of certain managing directors, which serve to reduce their respective incentive compensation payments. We expect this seasonal pattern of cash flow to continue.

Liquidity is also affected by the level of deposits and other customer payables, principally at LFB. To the extent that such deposits and other customer payables rise or fall, this has a corresponding impact on liquidity held at LFB, with the majority of such amounts generally being recorded in “deposits with banks and short-term investments”. In the first half of 2019, as reflected on the condensed consolidated statements of financial condition, both “deposits with banks and short-term investments” and “deposits and other customer payables” increased as compared to December 31, 2018, due to a higher level of LFB customer-related demand deposits, primarily from clients and funds managed by LFG.

Lazard’s condensed consolidated financial statements are presented in U.S. Dollars. Many of Lazard’s non-U.S. subsidiaries have a functional currency (i.e., the currency in which operational activities are primarily conducted) that is other than the U.S. Dollar, generally the currency of the country in which such subsidiaries are domiciled. Such subsidiaries’ assets and liabilities are translated into U.S. Dollars at the respective balance sheet date exchange rates, while revenue and expenses are translated at average exchange rates during the year based on the daily closing exchange rates. Adjustments that result from translating amounts from a subsidiary’s functional currency are reported as a component of stockholders’ equity. Foreign currency remeasurement gains and losses on transactions in non-functional currencies are included on the condensed consolidated statements of operations.

We regularly monitor our liquidity position, including cash levels, investments in U.S. Treasury securities, credit lines, principal investment commitments, interest and principal payments on debt, capital expenditures, dividend payments, purchases of shares of Class A common stock and matters relating to liquidity and to compliance with regulatory net capital requirements. At June 30, 2019, Lazard had approximately $919 million of cash, with such amount including approximately $517 million held at Lazard’s operations outside the U.S. Lazard provides for income taxes on substantially all of its foreign earnings. We expect that no material amount of additional taxes would be recognized upon receipt of dividends or distributions of such earnings from our foreign operations.

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We maintain lines of credit in excess of anticipated liquidity requirements. As of June 30, 2019, Lazard had approximately $168 million in unused lines of credit available to it, including a $150 million, five-year, senior revolving credit facility with a group of lenders that expires in September 2020 (the “Amended and Restated Credit Agreement”) (see “—Financing Activities” below) and unused lines of credit available to LFB of approximately $17 million.

The Amended and Restated Credit Agreement contains customary terms and conditions, including limitations on consolidations, mergers, indebtedness and certain payments, as well as financial condition covenants relating to leverage and interest coverage ratios. Lazard Group’s obligations under the Amended and Restated Credit Agreement may be accelerated upon customary events of default, including non-payment of principal or interest, breaches of covenants, cross-defaults to other material debt, a change in control and specified bankruptcy events.

Financing Activities

The table below sets forth our corporate indebtedness as of June 30, 2019 and December 31, 2018. The agreements with respect to this indebtedness are discussed in more detail in our condensed consolidated financial statements and related notes included elsewhere in this Form 10-Q and in our Form 10-K.

		Outstanding as of
		June 30, 2019						December 31, 2018
Senior Debt	Maturity Date	Principal		Unamortized Debt Costs		Carrying Value		Principal		Unamortized Debt Costs		Carrying Value
		($ in millions)
Lazard Group 2020 Senior Notes	2020	$	-	$	-	$	-	$	250.0	$	0.9	$	249.1
Lazard Group 2025 Senior Notes	2025		400.0		2.7		397.3		400.0		2.9		397.1
Lazard Group 2027 Senior Notes	2027		300.0		3.0		297.0		300.0		3.2		296.8
Lazard Group 2028 Senior Notes	2028		500.0		8.3		491.7		500.0		8.8		491.2
Lazard Group 2029 Senior Notes	2029		500.0		7.9		492.1		-		-		-
		$	1,700.0	$	21.9	$	1,678.1	$	1,450.0	$	15.8	$	1,434.2

During March 2019, Lazard Group completed an offering of the 2029 Notes. Lazard Group used a portion of the net proceeds of the 2029 Notes to redeem or otherwise retire the remaining 2020 Notes in transactions that occurred during March 2019 and April 2019. See Note 11 of Notes to Condensed Consolidated Financial Statements.

Lazard’s annual cash flow generated from operations historically has been sufficient to enable it to meet its annual obligations. We believe that our cash flows from operating activities, along with the use of our credit lines as needed, should be sufficient for us to fund our current obligations for the next 12 months.

As long as the lenders’ commitments remain in effect, any loan pursuant to the Amended and Restated Credit Agreement remains outstanding and unpaid or any other amount is due to the lending bank group, the Amended and Restated Credit Agreement includes financial covenants that require that Lazard Group not permit (i) its Consolidated Leverage Ratio (as defined in the Amended and Restated Credit Agreement) for the 12-month period ending on the last day of any fiscal quarter to be greater than 3.25 to 1.00 or (ii) its Consolidated Interest Coverage Ratio (as defined in the Amended and Restated Credit Agreement) for the 12-month period ending on the last day of any fiscal quarter to be less than 3.00 to 1.00. For the 12-month period ended June 30, 2019, Lazard Group was in compliance with such ratios, with its Consolidated Leverage Ratio being 1.78 to 1.00 and its Consolidated Interest Coverage Ratio being 15.24 to 1.00. In any event, no amounts were outstanding under the Amended and Restated Credit Agreement as of June 30, 2019.

In addition, the Amended and Restated Credit Agreement, indenture and supplemental indentures relating to Lazard Group’s senior notes contain certain other covenants (none of which relate to financial condition), events of default and other customary provisions. At June 30, 2019, the Company was in compliance with all of these provisions. We may, to the extent required and subject to restrictions contained in our financing arrangements, use other financing sources, which may cause us to be subject to additional restrictions or covenants.

See Note 11 of Notes to Condensed Consolidated Financial Statements for additional information regarding senior debt.

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Stockholders’ Equity

At June 30, 2019, total stockholders’ equity was $718 million, as compared to $970 million at December 31, 2018, including $619 million and $917 million attributable to Lazard Ltd on the respective dates. The net activity in stockholders’ equity during the six month period ended June 30, 2019 is reflected in the table below (in millions of dollars):

Stockholders’ Equity - January 1, 2019	$	970
Increase (decrease) due to:
Net income		170
Other comprehensive income		2
Amortization of share-based incentive compensation		161
Purchase of Class A common stock		(352	)
Settlement of share-based incentive compensation (a)		(92	)
Class A common stock dividends		(155	)
Other - net		14
Stockholders’ Equity - June 30, 2019	$	718

(a) The tax withholding portion of share-based compensation is settled in cash, not shares.

The Board of Directors of Lazard has issued a series of authorizations to repurchase Class A common stock, which help offset the dilutive effect of our share-based incentive compensation plans. During a given year the Company intends to repurchase at least as many shares as it expects to ultimately issue pursuant to such compensation plans in respect of year-end incentive compensation attributable to the prior year. The rate at which the Company purchases shares in connection with this annual objective may vary from quarter to quarter due to a variety of factors. Purchases with respect to such program are set forth in the table below:

Six Months Ended June 30:	Number of Shares Purchased		Average Price Per Share
2018		4,147,526	$	53.96
2019		9,715,003	$	36.20

As of June 30, 2019, a total of $244 million of share repurchase authorization remained available under the Company’s share repurchase program, all of which will expire on December 31, 2020.

During the six month period ended June 30, 2019, the Company had in place trading plans under Rule 10b5-1 of the Securities Exchange Act of 1934, as amended, pursuant to which it effected stock repurchases in the open market.

On July 24, 2019, the Board of Directors of Lazard declared a quarterly dividend of $0.47 per share on our Class A common stock.  The dividend is payable on August 16, 2019, to stockholders of record on August 5, 2019.

The Company plans to continue to deploy excess cash and may do so in a variety of ways, which may include repurchasing outstanding shares of Class A common stock, paying dividends to stockholders and repurchasing its outstanding debt.

See Notes 13 and 14 of Notes to Condensed Consolidated Financial Statements for additional information regarding Lazard’s stockholders’ equity and incentive plans, respectively.

Regulatory Capital

We actively monitor our regulatory capital base. Our principal subsidiaries are subject to regulatory requirements in their respective jurisdictions to ensure their general financial soundness and liquidity, which require, among other things, that we comply with rules regarding certain minimum capital requirements, record-keeping, reporting procedures, relationships with customers, experience and training requirements for employees and certain other requirements and procedures. These regulatory requirements may restrict the flow of funds to and from affiliates. See Note 19 of Notes to Condensed Consolidated Financial Statements for further information. These regulations differ in the U.S., the U.K., France and other countries in which we operate. Our capital structure is designed to provide each of our subsidiaries with capital and liquidity consistent with its business and regulatory requirements. For a discussion of regulations relating to us, see Item 1, “Business—Regulation” included in our Form 10-K.

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Contractual Obligations

The following table sets forth information relating to Lazard’s contractual obligations as of June 30, 2019:

	Contractual Obligations Payment Due by Period
	Total		Less than 1 Year		1-3 Years		3-5 Years		More than 5 Years
	($ in thousands)
Senior debt (including interest) (a)	$	2,308,792	$	70,250	$	140,500	$	140,500	$	1,957,542
Operating leases (exclusive of $22,905 of    committed sublease income)		710,633		39,879		149,726		109,107		411,921
Investment capital funding commitments (b)		8,264		8,264		-		-		-
Total (c)	$	3,027,689	$	118,393	$	290,226	$	249,607	$	2,369,463

(a) During March 2019, Lazard Group completed an offering of $500,000 aggregate principal amount of the 2029 Notes. Interest on the 2029 Notes is payable semi-annually on March 11 and September 11 of each year, beginning September 11, 2019. Lazard Group used a portion of the net proceeds of the 2029 Notes during March and April 2019 to redeem or otherwise retire the remaining $250,000 of the 2020 Notes. See Note 11 of Notes to Condensed Consolidated Financial Statements.

(b) Unfunded commitments to private equity investments consolidated but not owned by Lazard of $13,400 are excluded. Such commitments are required to be funded by capital contributions from noncontrolling interest holders. See Note 6 of Notes to Condensed Consolidated Financial Statements. These amounts are generally due on demand and therefore are presented in the “less than 1 year” category.

(c) The table above excludes contingent obligations, given the inability to make a reasonably reliable estimate of the timing of the amounts of any such payments. The table above also excludes any possible payments for uncertain tax positions and payments pursuant to the Company’s tax receivable agreement, given that the actual amount and timing of payments under the tax receivable agreement could differ materially from our estimates. At June 30, 2019, a tax receivable agreement obligation of $246,953 was recorded on the condensed consolidated statements of financial condition. See “Critical Accounting Policies and Estimates – Income Taxes” below. See also Notes 12, 14, 15, 16 and 18 of Notes to Condensed Consolidated Financial Statements regarding information in connection with commitments, incentive plans, employee benefit plans, income taxes and tax receivable agreement obligations, respectively.

Critical Accounting Policies and Estimates

Management’s discussion and analysis of our condensed consolidated financial condition and results of operations is based upon our condensed consolidated financial statements, which have been prepared in conformity with U.S. GAAP. The preparation of Lazard’s condensed consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosure of contingent assets and liabilities. On an ongoing basis, Lazard evaluates its estimates, including those related to revenue recognition, income taxes (including the impact on the tax receivable agreement obligation), investing activities and goodwill. Lazard bases these estimates on historical experience and various other assumptions that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments, including judgments regarding the carrying values of assets and liabilities, that are not readily apparent from other sources. Actual results may differ from these estimates.

Lazard believes that the critical accounting policies set forth below comprise the most significant estimates and judgments used in the preparation of its condensed consolidated financial statements.

Revenue Recognition

Lazard generates substantially all of its net revenue from providing Financial Advisory and Asset Management services to clients. Lazard recognizes revenue when the following criteria are met:

• a contract with a client has been identified;

• the performance obligations in the contract have been identified;

• the fee or other transaction price has been determined;

• the fee or other transaction price has been allocated to each performance obligation in the contract; and

• the Company has satisfied the applicable performance obligation.

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The Company earns performance-based incentive fees on various investment products, including traditional products and alternative investment funds such as hedge funds and private equity funds. See “Financial Statement Overview” for a description of our revenue recognition policies on such fees.

If, in Lazard’s judgment, collection of a fee is not probable, Lazard will not recognize revenue until the uncertainty is removed. We maintain an allowance for doubtful accounts to provide coverage for estimated losses from our receivables. We determine the adequacy of the allowance by estimating the probability of loss based on our analysis of the client’s creditworthiness and specifically reserve against exposures where we determine the receivables are impaired, which may include situations where a fee is in dispute or litigation has commenced.

With respect to fees receivable from Financial Advisory activities, such receivables are generally deemed past due when they are outstanding 60 days from the date of invoice. However, some Financial Advisory transactions include specific contractual payment terms that may vary from one month to four years (as is the case for our Private Capital Advisory fees) following the invoice date or may be subject to court approval (as is the case with restructuring assignments that include bankruptcy proceedings). In such cases, receivables are deemed past due when payment is not received by the agreed-upon contractual date or the court approval date, respectively. Financial Advisory fee receivables past due in excess of 180 days are fully provided for unless there is evidence that the balance is collectible. Asset Management fees are deemed past due and fully provided for when such receivables are outstanding 12 months after the invoice date. Notwithstanding our policy for receivables past due, we specifically reserve against exposures relating to Financial Advisory and Asset Management fees where we determine receivables are impaired.

Compensation Liabilities

Annual discretionary compensation represents a significant portion of our annual compensation and benefits expense. We allocate the estimated amount of such annual discretionary compensation to interim periods in proportion to the amount of operating revenue earned in such periods based on an assumed annual ratio of awarded compensation and benefits expense to operating revenue. See “Financial Statement Overview—Operating Expenses” for more information on our periodic compensation and benefits expense.

Income Taxes

As part of the process of preparing our consolidated financial statements, we estimate our income taxes for each of our tax-paying entities in its respective jurisdiction. In addition to estimating actual current tax liabilities for these jurisdictions, we also must account for the tax effects of differences between the financial reporting and tax reporting of items, such as basis adjustments, compensation and benefits expense, and depreciation and amortization. Differences which are temporary in nature result in deferred tax assets and liabilities. Significant judgment is required in determining our provision for income taxes, our deferred tax assets and liabilities, any valuation allowance recorded against our deferred tax assets and our unrecognized tax benefits.

We recognize a deferred tax asset if it is more likely than not (defined as a likelihood of greater than 50%) that a tax benefit will be accepted by a taxing authority. The measurement of deferred tax assets and liabilities is based upon currently enacted tax rates in the applicable jurisdictions. At December 31, 2018, on a consolidated basis, we recorded gross deferred tax assets of approximately $736 million, with such amount partially offset by a valuation allowance of approximately $73 million (as described below).

Subsequent to the initial recognition of deferred tax assets, we also must continually assess the likelihood that such deferred tax assets will be realized. If we determine that we may not fully derive the benefit from a deferred tax asset, we consider whether it would be appropriate to apply a valuation allowance against the applicable deferred tax asset, taking into account all available information. The ultimate realization of a deferred tax asset for a particular entity depends, among other things, on the generation of taxable income by such entity in the applicable jurisdiction.

We consider multiple possible sources of taxable income when assessing a valuation allowance against a deferred tax asset, including:

• future reversals of existing taxable temporary differences;

• future taxable income exclusive of reversing temporary differences and carryforwards;

• taxable income in prior carryback years; and

• tax-planning strategies.

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The assessment regarding whether a valuation allowance is required or should be adjusted also considers all available information, including the following:

• nature, frequency, magnitude and duration of any past losses and current operating results;

• duration of statutory carryforward periods;

• historical experience with tax attributes expiring unused; and

• near-term and medium-term financial outlook.

The weight we give to any particular item is, in part, dependent upon the degree to which it can be objectively verified. We give greater weight to the recent results of operations of a relevant entity. Pre-tax operating losses on a three year cumulative basis or lack of sustainable profitability are considered objectively verifiable evidence and will generally outweigh a projection of future taxable income.

Certain of our tax-paying entities have individually experienced losses on a cumulative three year basis or have tax attributes that may expire unused. In addition, one of our tax-paying entities has recorded a valuation allowance on substantially all of its deferred tax assets due to the combined effect of operating losses in certain subsidiaries of that entity as well as foreign taxes that together substantially offset any U.S. tax liability. Taking into account all available information, we cannot determine that it is more likely than not that deferred tax assets held by these entities will be realized. Consequently, we have recorded valuation allowances on $73 million of deferred tax assets held by these entities as of December 31, 2018.

We record tax positions taken or expected to be taken in a tax return based upon our estimates regarding the amount that is more likely than not to be realized or paid, including in connection with the resolution of any related appeals or other legal processes. Accordingly, we recognize liabilities for certain unrecognized tax benefits based on the amounts that are more likely than not to be settled with the relevant taxing authority. Such liabilities are evaluated periodically as new information becomes available and any changes in the amounts of such liabilities are recorded as adjustments to “income tax expense.” Liabilities for unrecognized tax benefits involve significant judgment and the ultimate resolution of such matters may be materially different from our estimates.

In addition to the discussion above regarding deferred tax assets and associated valuation allowances, as well as unrecognized tax benefit liability estimates, other factors affect our provision for income taxes, including changes in the geographic mix of our business, the level of our annual pre-tax income, transfer pricing and intercompany transactions.

See Item 1A, “Risk Factors” in our Form 10-K and Note 16 of Notes to Condensed Consolidated Financial Statements for additional information related to income taxes.

Amended and Restated Tax Receivable Agreement

During the period ended June 30, 2015, we released substantially all of our valuation allowance against deferred tax assets. As a result, we accrued a corresponding liability during the period ended June 30, 2015 for amounts relating to the Second Amended and Restated Tax Receivable Agreement, dated as of October 26, 2015 (the “Amended and Restated Tax Receivable Agreement”), between Lazard and LTBP Trust (the “Trust”). See Note 18 of Notes to Condensed Consolidated Financial Statements for additional information regarding the Amended and Restated Tax Receivable Agreement.

The amount of the Amended and Restated Tax Receivable Agreement liability is an undiscounted amount based upon currently enacted tax laws, including the Tax Act, the current structure of the Company and various assumptions regarding potential future operating profitability. The assumptions reflected in the estimate involve significant judgment, and if our structure were to change or our annual taxable income were to increase, we could be required to accelerate payments under the Amended and Restated Tax Receivable Agreement. As such, the actual amount and timing of payments under the Amended and Restated Tax Receivable Agreement could differ materially from our estimates. Any changes in the amount of the estimated liability would be recorded as a non-compensation expense in the condensed consolidated statement of operations. Adjustments, if necessary, to the related deferred tax assets would be recorded through income tax expense.

The cumulative liability relating to our obligations under the Amended and Restated Tax Receivable Agreement recorded as of June 30, 2019 and December 31, 2018 was $247 million and $271 million, respectively, and is recorded in “tax receivable agreement obligation” on the condensed consolidated statements of financial condition.

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Investments

Investments consist primarily of interest-bearing deposits, debt and equity securities, and interests in alternative investment, debt, equity and private equity funds.

These investments, with the exception of interest-bearing deposits, are carried at fair value on the condensed consolidated statements of financial condition, and any increases or decreases in the fair value of these investments are reflected in earnings. The fair value of investments is generally based upon market prices or the net asset value (“NAV”) or its equivalent for investments in funds. See Note 6 of Notes to Condensed Consolidated Financial Statements for additional information on the measurement of the fair value of investments.

Lazard is subject to market and credit risk on investments held. As such, gains and losses on investment positions held, which arise from sales or changes in the fair value of the investments, are not predictable and can cause periodic fluctuations in net income.

Data relating to investments is set forth below:

	June 30, 2019		December 31, 2018
	($ in thousands)
Seed investments by asset class:
Equities (a)	$	86,251	$	73,410
Fixed income		8,308		9,548
Alternative investments		31,293		7,131
Total seed investments		125,852		90,089
Other investments owned:
Private equity (b)		29,058		41,788
Interest-bearing deposits		511		510
Fixed income and other (c)		149,453		226,346
Total other investments owned		179,022		268,644
Subtotal		304,874		358,733
Add:
Private equity consolidated, not owned (d)		12,810		14,555
LFI (e)		257,740		201,860
Total investments	$	575,424	$	575,148

(a) At June 30, 2019 and December 31, 2018, seed investments in directly owned equity securities were invested as follows:

	June 30, 2019			December 31, 2018
Percentage invested in:
Financials		29	%		30	%
Consumer		29			28
Industrial		12			13
Technology		13			14
Other		17			15
Total		100	%		100	%

(b) Private equity investments include investments related to certain legacy businesses and co-investments in private equity funds managed by our Asset Management business. Co-investments owned were $25 million and $27 million as of June 30, 2019 and December 31, 2018, respectively.

(c) At June 30, 2019 and December 31, 2018, includes investments in U.S. Treasury securities of approximately $125 million and $200 million, respectively, with original maturities of greater than three months and less than one year.

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(d) Represents private equity investments that are consolidated but owned by noncontrolling interests, and therefore do not subject the Company to market or credit risk. The applicable noncontrolling interests are presented within “stockholders’ equity” on the condensed consolidated statements of financial condition.

(e) Composed of investments held in connection with LFI and other similar deferred compensation arrangements. The market risk associated with such investments is equally offset by the market risk associated with the derivative liability with respect to awards expected to vest. The Company is subject to market risk associated with any portion of such investments that employees may forfeit. See “—Risk Management—Risks Related to Derivatives” for risk management information relating to derivatives.  LFI investments held in entities in which the Company maintained a controlling interest were $91 million in eight entities as of June 30, 2019, as compared to $69 million in three entities as of December 31, 2018.

At June 30, 2019 and December 31, 2018, total investments with a fair value of $575 million and $575 million, respectively, included $65 million and $57 million, respectively, or 11% and 10%, respectively, of investments that were classified using NAV or its equivalent as a practical expedient. See Notes 5 and 6 of Notes to Condensed Consolidated Financial Statements for additional information regarding investments measured at fair value, including the levels of fair value within which such measurements of fair value fall.

As of June 30, 2019 and December 31, 2018, the Company held seed investments of approximately $126 million and $90 million, respectively. Seed investments held in entities in which the Company maintained a controlling interest were $66 million in nine entities as of June 30, 2019, as compared to $31 million in eight entities as of December 31, 2018.

As of June 30, 2019 and December 31, 2018, the Company did not consolidate or deconsolidate any seed investment entities or LFI investment entities with the exception of the recent consolidation of certain LFI funds (see Note 21 of Notes to the Condensed Consolidated Financial Statements). As such, 100% of the recorded balance of seed investments and substantially all of LFI investments as of June 30, 2019 and December 31, 2018 represented the Company’s economic interest in the seed and LFI investments. See “—Consolidation of Variable Interest Entities” below for more information on the Company’s policy regarding the consolidation of seed and LFI investment entities.

For additional information regarding risks associated with our investments, see “Risk Management—Investments” below as well as Item 1A, “Risk Factors—Other Business Risks—Our results of operations may be affected by fluctuations in the fair value of positions held in our investment portfolios” in our Form 10-K.

Assets Under Management

AUM primarily consists of debt and equity instruments, which have a value that is readily available based on either prices quoted on a recognized exchange or prices provided by external pricing services.

Prices of equity and debt securities and other instruments that comprise our AUM are provided by well-recognized, independent, third-party vendors. Such third-party vendors rely on prices provided by external pricing services which are obtained from recognized exchanges or markets, or, for certain fixed income securities, from an evaluated bid or other similarly sourced price.

Either directly, or through our third-party vendors, we perform a variety of regular due diligence procedures on our pricing service providers. Those procedures include oversight by our internal operations group, review of the pricing service providers’ internal control frameworks, review of the pricing service providers’ valuation methodologies, reconciliation to client custodial account values and comparison of significant pricing differences.

Goodwill

In accordance with current accounting guidance, goodwill has an indefinite life and is tested for impairment annually, as of November 1, or more frequently if circumstances indicate impairment may have occurred. The Company performs a qualitative evaluation about whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount in lieu of actually calculating the fair value of the reporting unit. See Note 10 of Notes to Condensed Consolidated Financial Statements for additional information regarding goodwill.

Consolidation

The condensed consolidated financial statements include the accounts of Lazard Group and entities in which it has a controlling interest. Lazard determines whether it has a controlling interest in an entity by first evaluating whether the entity is a voting interest entity (“VOE”) or a variable interest entity (“VIE”) under U.S. GAAP.

• Voting Interest Entities. VOEs are entities in which (i) the total equity investment at risk is sufficient to enable the entity to finance itself independently and (ii) the equity holders have the obligation to absorb losses, the right to receive residual returns and the right to make decisions about the entity’s activities. Lazard is required to consolidate a VOE if it holds a majority of the voting interest in such VOE.

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• Variable Interest Entities. VIEs are entities that lack one or more of the characteristics of a VOE. If Lazard has a variable interest, or a combination of variable interests, in a VIE, it is required to analyze whether it needs to consolidate such VIE. Lazard is required to consolidate a VIE if we are the primary beneficiary having (i) the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance and (ii) the obligation to absorb losses of, or receive benefits from, the VIE that could be potentially significant to the VIE.

Lazard’s involvement with various entities that are VOEs or VIEs primarily arises from LFI investments and investment management contracts with fund entities in our Asset Management business. Lazard is not required to consolidate such entities because, with the exception of certain seed and LFI investments, as discussed below, we do not hold more than an inconsequential equity interest in such entities and we do not hold other variable interests (including our investment management agreements, which do not meet the definition of variable interests) in such entities.

Lazard makes seed and LFI investments in certain entities that are considered VOEs and VIEs and often require consolidation as a result of our investment. The impact of seed and LFI investment entities that require consolidation on the condensed consolidated financial statements, including any consolidation or deconsolidation of such entities, is not material to our financial statements. Our exposure to loss from entities in which we have made such investments is limited to the extent of our investment in, or investment commitment to, such entities. See “Critical Accounting Policies and Estimates—Investments” above for more information regarding our investments.

Generally, when the Company initially invests to seed an investment entity, the Company is the majority owner of the entity. Our majority ownership in seed investment entities represents a controlling interest, except when we are the general partner in such entities and the third-party investors have the right to replace the general partner. To the extent material, we consolidate seed and LFI investment entities in which we own a controlling interest, and we would deconsolidate any such entity when we no longer have a controlling interest in such entity.

Risk Management

Investments

The Company has investments in a variety of asset classes, primarily debt and equity securities, and interests in alternative investments, debt, equity and private equity funds. The Company makes investments primarily to seed strategies in our Asset Management business or to reduce exposure arising from LFI and other similar deferred compensation arrangements. The Company measures its net economic exposure to market and other risks arising from investments that it owns, excluding (i) investments held in connection with LFI and other similar deferred compensation arrangements, (ii) investments in funds owned entirely by the noncontrolling interest holders of certain acquired entities and (iii) interest-bearing deposits with maturities over 90 days that allow daily withdrawals without principal penalties.

Risk sensitivities include the effects of economic hedging. For equity market price risk, investment portfolios and their corresponding hedges are beta-adjusted to the All-Country World equity index. Fair value and sensitivity measurements presented herein are based on various portfolio exposures at a particular point in time and may not be representative of future results. Risk exposures may change as a result of ongoing portfolio activities and changing market conditions, among other things.

Equity Market Price Risk—At June 30, 2019 and December 31, 2018, the Company’s exposure to equity market price risk in its investment portfolio, which primarily relates to investments in equity securities, equity funds and hedge funds, was approximately $111 million and $84 million, respectively. The Company hedges market exposure arising from a significant portion of our equity investment portfolios by entering into total return swaps. The Company estimates that a hypothetical 10% adverse change in market prices would result in a net decrease of approximately $1.0 million and $0.8 million in the carrying value of such investments as of June 30, 2019 and December 31, 2018, respectively, including the effect of the hedging transactions.

Interest Rate/Credit Spread Risk—At June 30, 2019 and December 31, 2018, the Company’s exposure to interest rate and credit spread risk in its investment portfolio related to investments in debt securities or funds which invest primarily in debt securities was $167 million and $245 million, respectively. The Company hedges market exposure arising from a portion of our debt investment portfolios by entering into total return swaps. The Company estimates that a hypothetical 100 basis point adverse change in interest rates or credit spreads would result in a decrease of approximately $1.0 million and $0.9 million in the carrying value of such investments as of June 30, 2019 and December 31, 2018, respectively, including the effect of the hedging transactions.

Foreign Exchange Rate Risk—At June 30, 2019 and December 31, 2018, the Company’s exposure to foreign exchange rate risk in its investment portfolio, which primarily relates to investments in foreign currency denominated equity and debt securities, was $50 million and $41 million, respectively. A significant portion of the Company’s foreign currency exposure related to our equity and debt investment portfolios is hedged through the aforementioned total return swaps. The Company estimates that a 10% adverse change in foreign exchange rates versus the U.S. Dollar would result in a decrease of approximately $0.6 million and $0.1 million in the carrying value of such investments as of June 30, 2019 and December 31, 2018, respectively, including the effect of the hedging transactions.

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Private Equity—The Company invests in private equity primarily as a part of its co-investment activities and in connection with certain legacy businesses. At June 30, 2019 and December 31, 2018, the Company’s exposure to changes in fair value of such investments was approximately $29 million and $42 million, respectively. The Company estimates that a hypothetical 10% adverse change in fair value would result in a decrease of approximately $2.9 million and $4.2 million in the carrying value of such investments as of June 30, 2019 and December 31, 2018, respectively.

Risks Related to Receivables

We maintain an allowance for doubtful accounts to provide coverage for probable losses from our receivables. We determine the adequacy of the allowance by estimating the probability of loss based on our analysis of the client’s creditworthiness, among other things, and specifically provide for exposures where we determine the receivables are impaired. At June 30, 2019, total receivables amounted to $705 million, net of an allowance for doubtful accounts of $34 million. As of that date, Financial Advisory and Asset Management fees, and customers and other receivables comprised 71% and 29% of total receivables, respectively. At December 31, 2018, total receivables amounted to $686 million, net of an allowance for doubtful accounts of $40 million. As of that date, Financial Advisory and Asset Management fees, and customers and other receivables comprised 73% and 27% of total receivables, respectively. At June 30, 2019 and December 31, 2018, the Company had receivables past due or deemed uncollectible of approximately $46 million and $42 million, respectively. See also “Critical Accounting Policies and Estimates—Revenue Recognition” above and Note 4 of Notes to Condensed Consolidated Financial Statements for additional information regarding receivables.

LFB engages in lending activities, including commitments to extend credit (primarily for clients of LFG). At June 30, 2019 and December 31, 2018, customer receivables included $70 million and $64 million, respectively, of LFB loans, with such loans being fully collateralized and closely monitored for counterparty creditworthiness.

Credit Concentrations

To reduce the exposure to concentrations of credit, the Company monitors large exposures to individual counterparties.

Risks Related to Derivatives

Lazard enters into forward foreign currency exchange contracts and interest rate swaps to hedge exposures to currency exchange rates and interest rates and uses total return swap contracts on various equity and debt indices to hedge a portion of its market exposure with respect to certain seed investments related to our Asset Management business. Derivative contracts are recorded at fair value. Derivative assets amounted to $2 million and $12 million at June 30, 2019 and December 31, 2018, respectively, and derivative liabilities, excluding the derivative liability arising from the Company’s obligation pertaining to LFI and other similar deferred compensation arrangements, amounted to $6 million and $1 million at such respective dates.

The Company also records derivative liabilities relating to its obligations pertaining to LFI awards and other similar deferred compensation arrangements, the fair value of which is based on the value of the underlying investments, adjusted for estimated forfeitures. Changes in the fair value of the derivative liabilities are equally offset by the changes in the fair value of investments which are expected to be delivered upon settlement of LFI awards. Derivative liabilities relating to LFI amounted to $229 million and $188 million at June 30, 2019 and December 31, 2018, respectively.

Risks Related to Cash and Cash Equivalents and Corporate Indebtedness

A significant portion of the Company’s indebtedness has fixed interest rates, while its cash and cash equivalents generally have market interest rates. Based on account balances as of June 30, 2019, Lazard estimates that its annual operating income relating to cash and cash equivalents would increase by approximately $9 million in the event interest rates were to increase by 1% and decrease by approximately $9 million if rates were to decrease by 1%.

As of June 30, 2019, the Company’s cash and cash equivalents totaled approximately $919 million. Substantially all of the Company’s cash and cash equivalents were invested in (i) highly liquid institutional money market funds (a significant majority of which were invested solely in U.S. Government or agency money market funds), (ii) in short-term interest bearing and non-interest bearing accounts at a number of leading banks throughout the world, (iii) in short-term certificates of deposit from such banks and (iv) in short-term U.S. Treasury securities. Cash and cash equivalents are constantly monitored. On a regular basis, management reviews its investment profile as well as the credit profile of its list of depositor banks in order to adjust any deposit or investment thresholds as necessary.

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Operational Risk

Operational risk is inherent in all our business and may, for example, manifest itself in the form of errors, breaches in the system of internal controls, employee misconduct, business interruptions, fraud, including fraud perpetrated by third parties, or legal actions due to operating deficiencies or noncompliance. The Company maintains a framework including policies and a system of internal controls designed to monitor and manage operational risk and provide management with timely and accurate information. Management within each of the operating companies is primarily responsible for its operational risk programs. The Company has in place business continuity and disaster recovery programs that manage its capabilities to provide services in the case of a disruption. We purchase insurance policies designed to help protect the Company against accidental loss and losses that may significantly affect our financial objectives, personnel, property or our ability to continue to meet our responsibilities to our various stakeholder groups.

Recent Accounting Developments

For a discussion of recently issued accounting developments and their impact or potential impact on Lazard’s consolidated financial statements, see Note 2 of Notes to Condensed Consolidated Financial Statements.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Risk Management

Quantitative and qualitative disclosures about market risk are included under the caption “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Risk Management”.

Item 4. Controls and Procedures

Our management, including our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures pursuant to Rule 13a-15 under the Exchange Act as of the end of the period covered by this quarterly report. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of the period covered by this quarterly report, our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) are effective to ensure that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

In addition, no change in our internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) occurred during our most recent fiscal quarter that has materially affected, or is likely to materially affect, our internal control over financial reporting.

As of January 1, 2019, we implemented a new enterprise resource planning (“ERP’) system, by transitioning certain of our operations, including the general ledger, to the new ERP system.  We have modified our existing controls infrastructure, as well as added other processes and internal controls, to adapt to our new ERP system and to take advantage of the increased functionality of the new system.

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PART II. OTHER INFORMATION

Item 1. Legal Proceedings

The Company is involved from time to time in judicial, regulatory and arbitration proceedings and inquiries concerning matters arising in connection with the conduct of our businesses, including proceedings initiated by former employees alleging wrongful termination. The Company reviews such matters on a case-by-case basis and establishes any required accrual if a loss is probable and the amount of such loss can be reasonably estimated. The Company experiences significant variation in its revenue and earnings on a quarterly basis. Accordingly, the results of any pending matter or matters could be significant when compared to the Company’s earnings in any particular fiscal quarter. The Company believes, however, based on currently available information, that the results of any pending matters, in the aggregate, will not have a material effect on its business or financial condition.

Item 1A. Risk Factors

There were no material changes from the risk factors previously disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

None.

Issuer Repurchases of Equity Securities

The following table sets forth information regarding Lazard’s purchases of its Class A common stock on a monthly basis during the second quarter of 2019. Share repurchases are recorded on a trade date basis.

Period	Total Number of Shares Purchased		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs
April 1 – April 30, 2019
Share Repurchase Program (1)		1,517,370	$	37.71		1,517,370	$	346.2	million
Employee Transactions (2)		3,244	$	38.55		-		-
May 1 – May 31, 2019
Share Repurchase Program (1)		949,685	$	33.35		949,685	$	314.5	million
Employee Transactions (2)		114,832	$	36.25		-		-
June 1 – June 30, 2019
Share Repurchase Program (1)		2,070,000	$	34.17		2,070,000	$	243.8	million
Employee Transactions (2)		36,367	$	31.47		-		-
Total
Share Repurchase Program (1)		4,537,055	$	35.18		4,537,055	$	243.8	million
Employee Transactions (2)		154,443	$	35.17		-		-

(1) During the six months ended June 30, 2019 and since 2017, the Board of Directors of Lazard authorized the repurchase of Class A common stock as set forth in the table below.

Date	Repurchase Authorization		Expiration
	($ in thousands)
October 2017	$	200,000	December 31, 2019
April 2018	$	300,000	December 31, 2020
October 2018	$	300,000	December 31, 2020
February 2019	$	300,000	December 31, 2020

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A significant portion of the Company’s purchases under the share repurchase program are used to offset a portion of the shares that have been or will be issued under the 2008 Plan and the 2018 Plan. Purchases under the share repurchase program may be made in the open market or through privately negotiated transactions. The rate at which the Company purchases shares in connection with the share repurchase program may vary from quarter to quarter due to a variety of factors. Amounts shown in this line item include repurchases of Class A common stock and exclude the shares of Class A common stock withheld by the Company to meet the minimum statutory tax withholding requirements as described below.

(2) Under the terms of the 2008 Plan and the 2018 Plan, upon the vesting of RSUs, PRSUs, DSUs and delivery of restricted Class A common stock, shares of Class A common stock may be withheld by the Company to meet the minimum statutory tax withholding requirements. During the three month period ended June 30, 2019, the Company satisfied such obligations in lieu of issuing (i) 105,174 shares of Class A common stock upon the vesting or settlement of 492,579 RSUs and PRSUs and (ii) 49,269 shares of Class A common stock upon the vesting of 283,788 shares of restricted Class A common stock.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None.

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PART IV

Item 6. Exhibits

3.1	Certificate of Incorporation and Memorandum of Association of the Registrant (incorporated by reference to Exhibit 3.1 to the Registrant’s Registration Statement (File No. 333-121407) on Form S-1/A filed on March 21, 2005).
3.2	Certificate of Incorporation on Change of Name of the Registrant (incorporated by reference to Exhibit 3.2 to the Registrant’s Registration Statement (File No. 333-121407) on Form S-1/A filed on March 21, 2005).
3.3	Amended and Restated Bye-Laws of Lazard Ltd (incorporated by reference to Exhibit 3.3 to the Registrant’s Quarterly Report (File No. 001-32492) on Form 10-Q filed on June 16, 2005).
3.4	First Amendment to Amended and Restated Bye-Laws of Lazard Ltd (incorporated by reference to Exhibit 3.4 to the Registrant’s Quarterly Report (File No. 001-32492) on Form 10-Q filed on May 9, 2008).
3.5	Second Amendment to the Amended and Restated Bye-Laws of Lazard Ltd (incorporated by reference to Exhibit 3.5 to the Registrant’s Quarterly Report (File No. 001-32492) on Form 10-Q filed on April 30, 2010).
4.1	Form of Specimen Certificate for Class A common stock (incorporated by reference to Exhibit 4.1 to the Registrant’s Registration Statement (File No. 333-121407) on Form S-1/A filed on April 11, 2005).
4.2	Indenture, dated as of May 10, 2005, by and between Lazard Group LLC and The Bank of New York, as Trustee (incorporated by reference to Exhibit 4.1 to Lazard Group LLC’s Registration Statement (File No. 333-126751) on Form S-4 filed on July 21, 2005).
4.3	Sixth Supplemental Indenture, dated as of February 13, 2015, between Lazard Group LLC and The Bank of New York Mellon, as trustee (incorporated by reference to Exhibit 4.1 of the Registrant’s Current Report on Form 8-K (File No. 001-32492) filed on February 13, 2015).
4.4	Seventh Supplemental Indenture, dated as of November 4, 2016, between Lazard Group LLC and The Bank of New York Mellon, as trustee (incorporated by reference to Exhibit 4.1 of the Registrant’s Current Report on Form 8-K (File No. 001-32492) filed on November 7, 2016).
4.5	Eighth Supplemental Indenture, dated as of September 19, 2018, between Lazard Group LLC and the Bank of New York Mellon, as trustee (incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K (File No. 001-32492) filed on September 19, 2018.
4.6	Ninth Supplemental Indenture, dated as of March 11, 2019, between Lazard Group LLC and The Bank of New York Mellon, as trustee (incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K (File No. 001-32492) filed on March 11, 2019)
4.7	Form of Senior Note (included in Exhibits 4.3, 4.4, 4.5, and 4.6).
10.1	Amended and Restated Operating Agreement of Lazard Group LLC, dated as of February 4, 2019 (incorporated by reference to Exhibit 99.1 to Registrant’s Current Report (File No. 001-32492) on Form 8-K filed on February 5, 2019).
10.2	Second Amended and Restated Tax Receivable Agreement, dated as of October 26, 2015, by and among Ltd Sub A, Ltd Sub B and LTBP Trust (incorporated by reference to Exhibit 10.2 to the Registrant’s Quarterly Report (File No. 001-32492) on Form 10-Q filed on October 28, 2015).
10.3	Lease, dated as of January 27, 1994, by and between Rockefeller Center Properties and Lazard Frères & Co. LLC (incorporated by reference to Exhibit 10.19 to the Registrant’s Registration Statement (File No. 333-121407) on Form S-1/A filed on February 11, 2005).
10.4	Fourth Amendment dated as of February 16, 2011, by and among RCPI Landmark Properties, L.L.C. (as the successor in interest to Rockefeller Center Properties), RCPI 30 Rock 22234849, L.L.C. and Lazard Group LLC (as the successor in interest to Lazard Frères & Co. LLC), to the Lease dated as of January 27, 1994, by and among Rockefeller Center Properties and Lazard Frères & Co. LLC (incorporated by reference to Exhibit 10.16 to the Registrant’s Quarterly Report (File No. 001-32492) on Form 10-Q filed on April 29, 2011).
10.5*	Lazard Ltd 2005 Equity Incentive Plan (incorporated by reference to Exhibit 10.21 to the Registrant’s Registration Statement (File No. 333-121407) on Form S-1/A filed on May 2, 2005).
10.6*	Lazard Ltd 2008 Incentive Compensation Plan (incorporated by reference to Annex B to the Registrant’s Definitive Proxy Statement on Schedule 14A (File No. 001-32492) filed on March 24, 2008).
10.7*	Lazard Ltd 2016 French Sub-plan (incorporated by reference to Annex B to the Registrant’s Definitive Proxy Statement on Schedule 14A (File No. 001-32492) filed on March 10, 2016).

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10.8*	Lazard Ltd 2018 Incentive Compensation Plan (incorporated by reference to Annex B to the Registrant’s Definitive Proxy Statement on Schedule 14A (File No. 001-32492) filed on March 15, 2018).
10.9*	Amended and Restated Agreement relating to Retention and Noncompetition and Other Covenants, dated as of March 29, 2019, by and among the Registrant, Lazard Group LLC and Kenneth M. Jacobs (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K (File No. 001-32492) filed on April 3, 2019).
10.10*	Amended and Restated Agreement relating to Retention and Noncompetition and Other Covenants, dated as of March 29, 2019, by and among the Registrant, Lazard Group LLC and Ashish Bhutani (incorporated by reference to Exhibit 10.3 to the Registrant’s Current Report on Form 8-K (File No. 001-32492) filed on April 3, 2019).
10.11*	Amended and Restated Agreement relating to Retention and Noncompetition and Other Covenants, dated as of March 29, 2019, by and among the Registrant, Lazard Group LLC and Scott D. Hoffman (incorporated by reference to Exhibit 10.4 to the Registrant’s Current Report on Form 8-K (File No. 001-32492) filed on April 3, 2019).
10.12*	Agreement relating to Retention and Noncompetition and Other Covenants, dated as of March 29, 2019, by and among the Registrant, Lazard Group LLC and Evan L. Russo (incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K (File No. 001-324927) filed April 3, 2019).
10.13*	Amended and Restated Agreement relating to Retention and Noncompetition and Other Covenants, dated as of March 29, 2019, by and among the Registrant, Lazard Group LLC and Alexander F. Stern (incorporated by reference to Exhibit 10.5 to the Registrant’s Current Report on Form 8-K (File No. 001-32492) filed on April 3, 2019).
10.14*	Form of Award Letter for Annual Grant of Deferred Stock Units to Non-Executive Directors (incorporated by reference to Exhibit 99.1 to the Registrant’s Current Report on Form 8-K (File No. 001-32492) filed on September 8, 2005).
10.15*	Form of Agreement evidencing a grant of Restricted Stock Units to Executive Officers under the 2008 Incentive Compensation Plan (incorporated by reference to Exhibit 10.41 to the Registrant’s Annual Report (File No. 001-32492) on Form 10-K filed on March 2, 2009).
10.16*	Form of Agreement evidencing a grant of Deferred Cash Award to Executive Officers (incorporated by reference to Exhibit 10.42 to the Registrant’s Annual Report (File No. 001-32492) on Form 10-K filed on March 2, 2009).
10.17*	Directors’ Fee Deferral Unit Plan (incorporated by reference to Exhibit 10.39 to the Registrant’s Quarterly Report (File No. 001-32492) on Form 10-Q filed on May 11, 2006).
10.18	Amended and Restated Credit Agreement, dated as of September 25, 2015, among Lazard Group LLC, the Banks from time to time parties thereto, and Citibank, N.A., as Administrative Agent (incorporated by reference to Exhibit 10.27 to the Registrant’s Quarterly Report (File No. 001-32492) on Form 10-Q filed on October 28, 2015).
10.19*	Form of Agreement evidencing a grant of Lazard Fund Interests to Named Executive Officers (incorporated by reference to Exhibit 10.55 to the Registrant’s Quarterly Report (File No. 001-32492) on Form 10-Q filed on May 1, 2013).
10.20*	Form of Agreement evidencing a February 20, 2014 grant of Performance-Based Stock Units under the 2008 Incentive Compensation Plan (incorporated by reference to Exhibit 10.55 to the Registrant’s Quarterly Report (File No. 001-32492) on Form 10-Q filed May 6, 2014).
10.21*	Agreement between the Company and Kenneth M. Jacobs, dated as of February 20, 2014, evidencing a grant of Performance-Based Stock Units under the 2008 Incentive Compensation Plan (incorporated by reference to Exhibit 10.56 to the Registrant’s Quarterly Report (File No. 001-32492) on Form 10-Q filed on May 6, 2014).
10.22*	Form of Agreement evidencing a grant of Restricted Stock under the 2008 Incentive Compensation Plan (incorporated by reference to Exhibit 10.55 to the Registrant’s Quarterly Report (File No. 001-32492) on Form 10-Q filed on April 30, 2010).
10.23*	Form of Agreement evidencing a grant of Lazard Fund Interests (incorporated by reference to Exhibit 10.55 to the Registrant’s Quarterly Report (File No. 001-32492) on Form 10-Q filed on April 29, 2011).

73

10.24*	Form of Agreement for Performance-Based Profits Interest Participation Right Units under the 2018 Incentive Compensation Plan (incorporated by reference to Exhibit 10.24 to the Registrant’s Quarterly Report (File No. 001-32492) on Form 10-Q filed on April 30, 2019).
31.1	Rule 13a-14(a) Certification of Kenneth M. Jacobs.
31.2	Rule 13a-14(a) Certification of Evan L. Russo.
32.1	Section 1350 Certification for Kenneth M. Jacobs.
32.2	Section 1350 Certification for Evan L. Russo.
101.INS	XBRL Instance Document – the instance document does not appear in the Interactive Data File because iXBRL tags are embedded within the Inline XBRL document.
101.SCH	XBRL Taxonomy Extension Schema
101.CAL	XBRL Taxonomy Extension Calculation Linkbase
101.DEF	XBRL Taxonomy Extension Definition Linkbase
101.LAB	XBRL Taxonomy Extension Label Linkbase
101.PRE	XBRL Taxonomy Extension Presentation Linkbase

* Management contract or compensatory plan or arrangement.

74

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Dated: July 29, 2019

LAZARD LTD
By:	/s/    Evan L. Russo
Name:	Evan L. Russo
Title:	Chief Financial Officer
By:	/s/    Dominick Ragone
Name:	Dominick Ragone
Title:	Chief Accounting Officer

75

EX-31.1

EXHIBIT 31.1

I, Kenneth M. Jacobs, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the quarter ended June 30, 2019 of Lazard Ltd (the “Registrant”);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;

4. The Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and

5. The Registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting.

Date: July 29, 2019

/s/ Kenneth M. Jacobs

Kenneth M. Jacobs

Chairman and Chief Executive Officer

EX-31.2

EXHIBIT 31.2

I, Evan L. Russo, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the quarter ended June 30, 2019 of Lazard Ltd (the “Registrant”);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;

4. The Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and

5. The Registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting.

Date: July 29, 2019

/s/ Evan L. Russo

Evan L. Russo

Chief Financial Officer

EX-32.1

EXHIBIT 32.1

July 29, 2019

Securities and Exchange Commission

100 F Street, NE

Washington, DC 20549

Pursuant to 18 U.S.C. § 1350, the undersigned officer of Lazard Ltd (the “Registrant”) hereby certifies that the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2019 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934 and that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

/s/    Kenneth M. Jacobs

Kenneth M. Jacobs

Chairman and Chief Executive Officer

The foregoing certification is being furnished solely pursuant to 18 U.S.C. § 1350 and is not being filed as part of the Report or as a separate disclosure document.

EX-32.2

EXHIBIT 32.2

July 29, 2019

Securities and Exchange Commission

100 F Street, NE

Washington, DC 20549

Pursuant to 18 U.S.C. § 1350, the undersigned officer of Lazard Ltd (the “Registrant”) hereby certifies that the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2019 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934 and that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

/s/    Evan L. Russo

Evan L. Russo

Chief Financial Officer

The foregoing certification is being furnished solely pursuant to 18 U.S.C. § 1350 and is not being filed as part of the Report or as a separate disclosure document.

XML

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2019	Jul. 19, 2019
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2019
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q2
Trading Symbol	LAZ
Entity Registrant Name	LAZARD LTD
Entity Central Index Key	0001311370
Entity Current Reporting Status	Yes
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Shell Company	false
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Common Stock, Shares Outstanding		129,766,091
Entity File Number	001-32492
Entity Tax Identification Number	980437848
Entity Address, Address Line One	Clarendon House
Entity Address, Address Line Two	2 Church Street
Entity Address, City or Town	Hamilton
Entity Address, State or Province	HM11
Entity Address, Country	Bermuda
City Area Code	441
Local Phone Number	295-1422
Subsidiaries of Lazard Ltd [Member]
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		22,883,607

XML

Condensed Consolidated Statements of Financial Condition - USD ($) $ in Thousands	Jun. 30, 2019	Dec. 31, 2018
ASSETS
Cash and cash equivalents	$ 919,221	$ 1,246,537
Deposits with banks and short-term investments	1,301,520	1,006,969
Cash deposited with clearing organizations and other segregated cash	39,761	38,379
Receivables (net of allowance for doubtful accounts of $33,535 and $40,164 at June 30, 2019 and December 31, 2018, respectively):
Fees	502,846	501,397
Customers and other	202,268	184,137
Total receivables, net	705,114	685,534
Investments	575,424	575,148
Property (net of accumulated amortization and depreciation of $351,119 and $339,770 at June 30, 2019 and December 31, 2018, respectively)	206,456	212,946
Operating lease right-of-use assets	477,432
Goodwill and other intangible assets (net of accumulated amortization of $66,908 and $65,949 at June 30, 2019 and December 31, 2018, respectively)	374,436	375,318
Deferred tax assets	589,076	597,776
Other assets	319,033	258,634
Total Assets	5,507,473	4,997,241
Liabilities:
Deposits and other customer payables	1,480,684	1,154,207
Accrued compensation and benefits	331,636	585,484
Operating lease liabilities	555,324
Senior debt	1,678,131	1,434,260
Deferred tax liabilities	2,717	5,571
Other liabilities	494,150	576,986
Total Liabilities	4,789,595	4,027,148
Commitments and contingencies
Common stock:
Class A, par value $.01 per share (500,000,000 shares authorized; 129,766,091 shares issued at June 30, 2019 and December 31, 2018, including shares held by subsidiaries as indicated below)	1,298	1,298
Additional paid-in-capital	582,342	750,692
Retained earnings	1,179,901	1,195,563
Accumulated other comprehensive loss, net of tax	(271,984)	(273,818)
Stockholders' equity subtotal before common stock held by subsidiaries and Noncontrolling interests, total	1,491,557	1,673,735
Class A common stock held by subsidiaries, at cost (21,761,253 and 17,574,805 shares at June 30, 2019 and December 31, 2018, respectively)	(872,755)	(756,884)
Total Lazard Ltd Stockholders’ Equity	618,802	916,851
Noncontrolling interests	99,076	53,242
Total Stockholders’ Equity	717,878	970,093
Total Liabilities and Stockholders’ Equity	5,507,473	4,997,241
LTBP Trust [Member]
Liabilities:
Tax receivable agreement obligation	246,953	270,640
Series A Preferred Stock [Member]
Preferred stock:
Preferred stock
Series B Preferred Stock [Member]
Preferred stock:
Preferred stock

XML

Condensed Consolidated Statements of Financial Condition (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2019	Dec. 31, 2018
Allowance for doubtful accounts receivables	$ 33,535	$ 40,164
Property, accumulated amortization and depreciation	351,119	339,770
Other intangible assets, accumulated amortization	$ 66,908	$ 65,949
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	15,000,000	15,000,000
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	500,000,000	500,000,000
Common stock, shares issued	129,766,091	129,766,091
Common stock held by subsidiaries, shares	21,761,253	17,574,805
Series A Preferred Stock [Member]
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Series B Preferred Stock [Member]
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0

XML

Condensed Consolidated Statements of Operations - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
REVENUE
Interest income	$ 4,013	$ 2,138	$ 7,813	$ 4,848
Total revenue	650,801	771,528	1,312,479	1,539,733
Interest expense	20,111	13,590	38,115	27,097
Net revenue	630,690	757,938	1,274,364	1,512,636
OPERATING EXPENSES
Compensation and benefits	372,470	416,159	744,724	821,206
Occupancy and equipment	30,953	29,240	59,248	59,478
Marketing and business development	28,784	28,228	56,768	53,887
Technology and information services	38,825	32,527	70,880	65,779
Professional services	19,144	16,714	33,361	29,145
Fund administration and outsourced services	28,493	33,227	57,423	68,411
Amortization and other acquisition-related (benefits) costs	5,042	(8,483)	8,512	(7,617)
Other	5,294	10,386	22,100	36,579
Total operating expenses	529,005	557,998	1,053,016	1,126,868
OPERATING INCOME	101,685	199,940	221,348	385,768
Provision for income taxes	28,172	51,561	51,359	75,728
NET INCOME	73,513	148,379	169,989	310,040
LESS - NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS	7,736	1,416	7,170	3,385
NET INCOME ATTRIBUTABLE TO LAZARD LTD	$ 65,777	$ 146,963	$ 162,819	$ 306,655
WEIGHTED AVERAGE SHARES OF COMMON STOCK OUTSTANDING:
Basic	111,981,204	120,306,257	111,962,729	120,118,182
Diluted	116,175,349	130,249,054	118,497,717	131,195,725
NET INCOME PER SHARE OF COMMON STOCK:
Basic	$ 0.57	$ 1.22	$ 1.44	$ 2.55
Diluted	$ 0.55	$ 1.13	$ 1.36	$ 2.34
Investment Banking and Other Advisory Fees [Member]
REVENUE
Revenue	$ 328,974	$ 421,444	$ 664,778	$ 830,170
Asset Management Fees [Member]
REVENUE
Revenue	296,581	335,891	589,019	673,987
Other [Member]
REVENUE
Revenue	$ 21,233	$ 12,055	$ 50,869	$ 30,728

XML

Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Statement Of Income And Comprehensive Income [Abstract]
NET INCOME	$ 73,513	$ 148,379	$ 169,989	$ 310,040
OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX:
Currency translation adjustments	(7,053)	(43,453)	(3,273)	(26,107)
Employee benefit plans:
Actuarial gain (net of tax expense of $2,420 and $1,746 for the three months ended June 30, 2019 and 2018, respectively, and $2,720 and $404 for the six months ended June 30, 2019 and 2018, respectively)	2,812	8,300	2,861	3,286
Adjustment for items reclassified to earnings (net of tax expense of $174 and $468 for the three months ended June 30, 2019 and 2018, respectively, and $352 and $684 for the six months ended June 30, 2019 and 2018, respectively)	1,113	777	2,245	1,839
OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX	(3,128)	(34,376)	1,833	(20,982)
COMPREHENSIVE INCOME	70,385	114,003	171,822	289,058
LESS - COMPREHENSIVE INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS	7,734	1,415	7,169	3,384
COMPREHENSIVE INCOME ATTRIBUTABLE TO LAZARD LTD	$ 62,651	$ 112,588	$ 164,653	$ 285,674

XML

Condensed Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Statement Of Income And Comprehensive Income [Abstract]
Tax expense on actuarial gain, employee benefit plans	$ 2,420	$ 1,746	$ 2,720	$ 404
Tax expense, adjustment for items reclassified to earnings, employee benefit plans	$ 174	$ 468	$ 352	$ 684

XML

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018
CASH FLOWS FROM OPERATING ACTIVITIES:
NET INCOME	$ 169,989	$ 310,040
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization of property	16,247	16,676
Noncash lease expense	26,720
Amortization of deferred expenses and share-based incentive compensation	226,629	225,647
Amortization and other acquisition-related (benefits) costs	8,512	(7,617)
Deferred tax provision	7,423	20,799
Loss on extinguishment of debt	6,505
(Increase) decrease in operating assets and increase (decrease) in operating liabilities:
Receivables-net	(19,520)	(154,430)
Investments	7,228	(79,998)
Other assets	(107,740)	(131,314)
Accrued compensation and benefits and other liabilities	(259,428)	(135,027)
Net cash provided by operating activities	82,565	64,776
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to property	(18,064)	(32,043)
Disposals of property	85	1,327
Net cash used in investing activities	(17,979)	(30,716)
Proceeds from:
Issuance of senior debt, net of expenses	491,875
Customer deposits, net	314,730	70,194
Contributions from noncontrolling interests	1,193	516
Payments for:
Senior debt	(255,746)
Distributions to noncontrolling interests	(7,811)	(5,060)
Payments under tax receivable agreement	(23,687)	(31,897)
Purchase of Class A common stock	(351,712)	(223,795)
Class A common stock dividends	(155,324)	(255,228)
Settlement of share-based incentive compensation	(96,089)	(109,218)
Other financing activities	(4,697)	(4,698)
Net cash used in financing activities	(87,268)	(559,186)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS AND RESTRICTED CASH	(8,701)	(46,762)
NET DECREASE IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH	(31,383)	(571,888)
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH—January 1	2,291,885	2,454,806
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH—June 30	$ 2,260,502	$ 1,882,918

XML

Condensed Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2019	Dec. 31, 2018	Jun. 30, 2018	Dec. 31, 2017
RECONCILIATION OF CASH AND CASH EQUIVALENTS AND RESTRICTED CASH WITHIN THE CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION:
Cash and cash equivalents	$ 919,221	$ 1,246,537
Deposits with banks and short-term investments	1,301,520	1,006,969
Cash deposited with clearing organizations and other segregated cash	39,761	38,379
TOTAL CASH AND CASH EQUIVALENTS AND RESTRICTED CASH	$ 2,260,502	$ 2,291,885	$ 1,882,918	$ 2,454,806

XML

Condensed Consolidated Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands	Total	Common Stock [Member]	Additional Paid-In-Capital [Member]	Retained Earnings [Member]	Accumulated Other Comprehensive Income (Loss), Net of Tax [Member]	Class A Common Stock Held By Subsidiaries [Member]	Total Lazard Ltd Stockholders' Equity [Member]	Noncontrolling Interests [Member]
Balance at Dec. 31, 2017	$ 1,258,905	$ 1,298	$ 788,140	$ 1,080,413	$ (232,518)	$ (437,530)	$ 1,199,803	$ 59,102
Balance (in shares) at Dec. 31, 2017		129,766,091				10,747,142
Comprehensive income (loss):
Net income	310,040			306,655			306,655	3,385
Other comprehensive income (loss) - net of tax	(20,982)				(20,981)		(20,981)	(1)
Amortization of share-based incentive compensation	169,830		169,830				169,830
Dividend-equivalents	(4,681)		33,627	(38,308)			(4,681)
Class A common stock dividends	(255,228)			(255,228)			(255,228)
Purchase of Class A common stock	$ (223,795)					$ (223,795)	(223,795)
Purchase of Class A common stock (in shares)	4,147,526					4,147,526
Delivery of Class A common stock in connection with share-based incentive compensation and related tax expense (benefit)	$ (116,730)		(340,963)			$ 224,233	(116,730)
Delivery of Class A common stock in connection with share-based incentive compensation and related tax expense (benefit) (in shares)						(5,172,915)
Business acquisitions and related equity transactions:
Delivery of Class A common stock			(61)			$ 61
Delivery of Class A common stock (in shares)						(1,858)
Class A common stock issuable (including related amortization)	289		289				289
Dividend equivalents			1,151	(1,151)
Distributions to noncontrolling interests, net	(4,544)							(4,544)
Balance at Jun. 30, 2018	1,113,104	$ 1,298	652,013	1,092,381	(253,499)	$ (437,031)	1,055,162	57,942
Balance (in shares) at Jun. 30, 2018		129,766,091				9,719,895
Balance at Mar. 31, 2018	1,056,181	$ 1,298	619,430	1,005,548	(219,124)	$ (410,591)	996,561	59,620
Balance (in shares) at Mar. 31, 2018		129,766,091				9,359,466
Comprehensive income (loss):
Net income	148,379			146,963			146,963	1,416
Other comprehensive income (loss) - net of tax	(34,376)				(34,375)		(34,375)	(1)
Amortization of share-based incentive compensation	87,010		87,010				87,010
Dividend-equivalents	(914)		5,221	(6,135)			(914)
Class A common stock dividends	(52,844)			(52,844)			(52,844)
Purchase of Class A common stock	(77,846)					$ (77,846)	(77,846)
Purchase of Class A common stock (in shares)						1,485,240
Delivery of Class A common stock in connection with share-based incentive compensation and related tax expense (benefit)	(9,537)		(60,943)			$ 51,406	(9,537)
Delivery of Class A common stock in connection with share-based incentive compensation and related tax expense (benefit) (in shares)						(1,124,811)
Business acquisitions and related equity transactions:
Class A common stock issuable (including related amortization)	144		144				144
Dividend equivalents			1,151	(1,151)
Distributions to noncontrolling interests, net	(3,093)							(3,093)
Balance at Jun. 30, 2018	1,113,104	$ 1,298	652,013	1,092,381	(253,499)	$ (437,031)	1,055,162	57,942
Balance (in shares) at Jun. 30, 2018		129,766,091				9,719,895
Balance at Dec. 31, 2018	970,093	$ 1,298	750,692	1,195,563	(273,818)	$ (756,884)	916,851	53,242
Balance (in shares) at Dec. 31, 2018		129,766,091				17,574,805
Comprehensive income (loss):
Net income	169,989			162,819			162,819	7,170
Other comprehensive income (loss) - net of tax	1,833				1,834		1,834	(1)
Amortization of share-based incentive compensation	161,083		125,202				125,202	35,881
Dividend-equivalents	(4,681)		20,142	(22,761)			(2,619)	(2,062)
Class A common stock dividends	(155,324)			(155,324)			(155,324)
Purchase of Class A common stock	$ (351,712)					$ (351,712)	(351,712)
Purchase of Class A common stock (in shares)	9,715,003					9,715,003
Delivery of Class A common stock in connection with share-based incentive compensation and related tax expense (benefit)	$ (91,731)		(327,572)			$ 235,841	(91,731)
Delivery of Class A common stock in connection with share-based incentive compensation and related tax expense (benefit) (in shares)						(5,528,555)
Business acquisitions and related equity transactions:
Class A common stock issuable (including related amortization)	13,482		13,482				13,482
Dividend equivalents			396	(396)
Distributions to noncontrolling interests, net	(6,618)							(6,618)
Consolidation of VIEs	11,464							11,464
Balance at Jun. 30, 2019	717,878	$ 1,298	582,342	1,179,901	(271,984)	$ (872,755)	618,802	99,076
Balance (in shares) at Jun. 30, 2019		129,766,091				21,761,253
Balance at Mar. 31, 2019	771,372	$ 1,298	535,926	1,171,754	(268,858)	$ (738,899)	701,221	70,151
Balance (in shares) at Mar. 31, 2019		129,766,091				17,846,122
Comprehensive income (loss):
Net income	73,513			65,777			65,777	7,736
Other comprehensive income (loss) - net of tax	(3,128)				(3,126)		(3,126)	(2)
Amortization of share-based incentive compensation	76,402		58,989				58,989	17,413
Dividend-equivalents	(1,631)		4,630	(5,574)			(944)	(687)
Class A common stock dividends	(51,922)			(51,922)			(51,922)
Purchase of Class A common stock	(159,615)					$ (159,615)	(159,615)
Purchase of Class A common stock (in shares)						4,537,055
Delivery of Class A common stock in connection with share-based incentive compensation and related tax expense (benefit)	(4,955)		(30,714)			$ 25,759	(4,955)
Delivery of Class A common stock in connection with share-based incentive compensation and related tax expense (benefit) (in shares)						(621,924)
Business acquisitions and related equity transactions:
Class A common stock issuable (including related amortization)	13,377		13,377				13,377
Dividend equivalents			134	(134)
Distributions to noncontrolling interests, net	(6,999)							(6,999)
Consolidation of VIEs	11,464							11,464
Balance at Jun. 30, 2019	$ 717,878	$ 1,298	$ 582,342	$ 1,179,901	$ (271,984)	$ (872,755)	$ 618,802	$ 99,076
Balance (in shares) at Jun. 30, 2019		129,766,091				21,761,253

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Condensed Consolidated Statements of Changes in Stockholders' Equity (Parenthetical) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Statement Of Stockholders Equity [Abstract]
Class A common stock dividends per share	$ 0.47	$ 0.44	$ 1.41	$ 2.15
Tax expense (benefit) related to delivery of Class A Common Stock in connection with share-based incentive compensation	$ (477)	$ 1,362	$ (4,358)	$ 7,512

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Organization and Basis of Presentation

6 Months Ended

Jun. 30, 2019

Organization Consolidation And Presentation Of Financial Statements [Abstract]

Organization and Basis of Presentation

1. ORGANIZATION AND BASIS OF PRESENTATION

Organization

Lazard Ltd, a Bermuda holding company, and its subsidiaries (collectively referred to as “Lazard Ltd”, “Lazard”, “we” or the “Company”), including Lazard Ltd’s indirect investment in Lazard Group LLC, a Delaware limited liability company (collectively referred to, together with its subsidiaries, as “Lazard Group”), is one of the world’s preeminent financial advisory and asset management firms and has long specialized in crafting solutions to the complex financial and strategic challenges of our clients. We serve a diverse set of clients around the world, including corporations, governments, institutions, partnerships and individuals.

Lazard Ltd indirectly held 100% of all outstanding Lazard Group common membership interests as of June 30, 2019 and December 31, 2018. Lazard Ltd, through its control of the managing members of Lazard Group, controls Lazard Group, which is governed by an Amended and Restated Operating Agreement dated as of February 4, 2019 (the “Operating Agreement”).

Lazard Ltd’s primary operating asset is its indirect ownership of the common membership interests of, and managing member interests in, Lazard Group, whose principal operating activities are included in two business segments:

• Financial Advisory, which offers corporate, partnership, institutional, government, sovereign and individual clients across the globe a wide array of financial advisory services regarding mergers and acquisitions (“M&A”), capital advisory, restructurings, shareholder advisory, sovereign advisory, capital raising and other strategic advisory, and

• Asset Management, which offers a broad range of global investment solutions and investment management services in equity and fixed income strategies, asset allocation strategies, alternative investments and private equity funds to corporations, public funds, sovereign entities, endowments and foundations, labor funds, financial intermediaries and private clients.

In addition, we record selected other activities in our Corporate segment, including management of cash, investments, deferred tax assets, outstanding indebtedness, certain contingent obligations, and assets and liabilities associated with Lazard Group’s Paris-based subsidiary Lazard Frères Banque SA (“LFB”).

Basis of Presentation

The accompanying condensed consolidated financial statements of Lazard Ltd have been prepared pursuant to the rules and regulations of the United States Securities and Exchange Commission (the “SEC”) regarding interim financial reporting. Accordingly, they do not include all of the information and notes required by accounting principles generally accepted in the United States of America (“U.S. GAAP”) for complete financial statements and should be read in conjunction with the audited consolidated financial statements and notes thereto included in Lazard Ltd’s Annual Report on Form 10-K for the year ended December 31, 2018. The accompanying December 31, 2018 unaudited condensed consolidated statement of financial condition data was derived from audited consolidated financial statements, but does not include all disclosures required by U.S. GAAP for annual financial statement purposes. The accompanying condensed consolidated financial statements reflect all adjustments which are, in the opinion of management, necessary for a fair presentation of the financial position, results of operations and cash flows for the interim periods presented.

Preparing financial statements requires management to make estimates and assumptions that affect the amounts that are reported in the financial statements and the accompanying disclosures. For example, discretionary compensation and benefits expense for interim periods is accrued based on the year-to-date amount of revenue earned, and an assumed annual ratio of compensation and benefits expense to revenue, with the applicable amounts adjusted for certain items. Although these estimates are based on management’s knowledge of current events and actions that Lazard may undertake in the future, actual results may differ materially from the estimates.

The consolidated results of operations for the three month and six month periods ended June 30, 2019 are not indicative of the results to be expected for any future interim or annual period.

The condensed consolidated financial statements include Lazard Ltd, Lazard Group and Lazard Group’s principal operating subsidiaries: Lazard Frères & Co. LLC (“LFNY”), a New York limited liability company, along with its subsidiaries, including Lazard Asset Management LLC and its subsidiaries (collectively referred to as “LAM”); the French limited liability companies Compagnie Financière Lazard Frères SAS (“CFLF”) along with its subsidiaries, LFB and Lazard Frères Gestion SAS (“LFG”), and Maison Lazard SAS and its subsidiaries; and Lazard & Co., Limited (“LCL”), through Lazard & Co., Holdings Limited (“LCH”), an English private limited company, together with their jointly owned affiliates and subsidiaries.

The Company’s policy is to consolidate entities in which it has a controlling financial interest. The Company consolidates:

• Voting interest entities (“VOEs”) where the Company holds a majority of the voting interest in such VOEs, and

• Variable interest entities (“VIEs”) where the Company is the primary beneficiary having the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance and the obligation to absorb losses of, or receive benefits from, the VIE that could be potentially significant to the VIE (see Note 21).

When the Company does not have a controlling interest in an entity, but exerts significant influence over such entity’s operating and financial decisions, the Company either (i) applies the equity method of accounting in which it records a proportionate share of the entity’s net earnings, or (ii) elects the option to measure at fair value. Intercompany transactions and balances have been eliminated.

Certain prior period amounts have been reclassified to conform to the current period presentation.

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Recent Accounting Developments

6 Months Ended

Jun. 30, 2019

New Accounting Pronouncements And Changes In Accounting Principles [Abstract]

Recent Accounting Developments

2. RECENT ACCOUNTING DEVELOPMENTS

Leases—In February 2016, the Financial Accounting Standards Board (the “FASB”) issued updated guidance for leases. The guidance requires a lessee to (i) recognize a right-of-use asset and a lease liability that is initially measured at the present value of the lease payments, in the condensed consolidated statement of financial condition, (ii) recognize a single lease cost, calculated so that the cost of the lease is allocated over the lease term on a straight-line basis and (iii) classify operating lease related cash payments within operating activities and finance lease related principal cash payments within financing activities (with interest included in interest paid) in the condensed consolidated statement of cash flows.

The Company adopted the new guidance on January 1, 2019 using the optional transition method, which allows such guidance to be applied initially at the adoption date with a cumulative-effect adjustment and without restating comparative periods. Lazard elected the package of practical expedients, which allows the carry-forward of the prior conclusions on lease definition, classification and initial direct costs related to the existing leases as of the adoption date.

Substantially all of the Company’s existing lease arrangements are operating leases. The adoption of the new guidance on January 1, 2019 resulted in a recognition of $502,000 of operating lease right-of-use assets (“ROU assets”) and $581,000 of operating lease liabilities in the Company’s condensed consolidated statements of financial condition.  The operating lease liabilities at January 1, 2019 reflect any remaining lease payments discounted using an incremental borrowing rate (on a collateralized basis) based on the remaining lease term (the “Discount”), as an implicit rate was not readily determinable for any of the Company’s existing operating leases.  The operating lease ROU assets are lower than the operating lease liabilities primarily because lease incentives reduce the ROU assets (see Note 9).

Improvements to Nonemployee Share-Based Payment Accounting—In June 2018, the FASB issued updated guidance to simplify the accounting for nonemployee share-based payment transactions. The new guidance generally requires equity-classified nonemployee share-based payment awards to be measured at the grant date, which is the date at which a grantor and grantee reach a mutual understanding of the key terms and conditions of a share-based payment award.  This update generally aligns the accounting for equity-classified share-based payment awards to nonemployees with the measurement date required for employees.  The Company adopted the new guidance on January 1, 2019 and its application did not have a material impact on the Company’s financial statements.

Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income—In February 2018, the FASB issued updated guidance on the tax effects of items in “accumulated other comprehensive income (loss), net of tax” (“AOCI”). Specifically, the new guidance will permit, but not require, a reclassification from AOCI to retained earnings for stranded tax effects resulting from the newly enacted federal corporate income tax rate under the Tax Cuts and Jobs Act of 2017. The amount of the reclassification would be the difference between the historical corporate income tax rate and the newly enacted 21% corporate income tax rate. The Company adopted the new guidance on January 1, 2019 without reclassifying any amounts from AOCI to retained earnings.  The application of the guidance did not have a material impact on the Company’s financial statements.

Financial Instruments—Credit Losses: Measurement of Credit Losses on Financial Instruments—In June 2016, the FASB issued new guidance regarding the measurement of credit losses on financial instruments. The new guidance replaces the incurred loss impairment methodology in the current guidance with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to determine credit loss estimates. The new guidance is effective for annual and interim periods beginning after December 15, 2019 with early adoption permitted for fiscal years beginning after December 15, 2018.  The new guidance is required to be applied using a modified retrospective approach. The Company is currently evaluating the new guidance.

Intangibles—Goodwill and Other: Simplifying the Test for Goodwill Impairment—In January 2017, the FASB issued updated guidance which eliminated Step 2 from the goodwill impairment test. Step 2 is the process of measuring a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. The new guidance requires entities to measure a goodwill impairment loss as the amount by which a reporting unit’s carrying value exceeds its fair value, limited to the carrying amount of goodwill. The FASB also eliminated the requirements for entities that have reporting units with zero or negative carrying amounts to perform a qualitative assessment for the goodwill impairment test. Instead, those entities would be required to disclose the amount of goodwill allocated to each reporting unit with a zero or negative carrying amount. The new guidance is effective for interim or annual goodwill impairment tests performed in fiscal years beginning after December 15, 2019, with early adoption permitted. The Company is currently evaluating the new guidance.

Intangibles—Internal-Use Software: Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract—In August 2018, the FASB issued updated guidance on the accounting for implementation costs incurred in a cloud computing arrangement. The new guidance requires the capitalization of the implementation costs incurred in a cloud computing arrangement to be aligned with the requirements for capitalizing costs incurred to develop or obtain internal-use software. The new guidance is effective for annual and interim reporting periods beginning after December 15, 2019, with early adoption permitted. Upon adoption, the Company may elect to apply the new guidance on either a prospective or retrospective basis. The Company is currently evaluating the new guidance.

Related Party Guidance for Variable Interest Entities—In October 2018, the FASB issued updated guidance that requires consideration of indirect interest held through related parties under common control for determining whether fees paid to decision makers and service providers are variable interests. The new guidance is effective for fiscal years and interim periods beginning after December 15, 2019, with early adoption permitted. The amendments are required to be applied retrospectively with a cumulative-effect adjustment. The Company is currently evaluating the new guidance.

Fair Value Measurement: Changes to the Disclosure Requirements for Fair Value Measurement—In August 2018, the FASB issued updated guidance which modifies the disclosure requirements on fair value measurement. The updated guidance eliminates or modifies various required disclosures under the current guidance and includes additional requirements. The new guidance is effective for annual and interim reporting periods beginning after December 15, 2019, with early adoption permitted.  With certain exceptions, the guidance is required to be applied retrospectively. The Company is currently evaluating the new guidance.

Compensation–Retirement Benefits: Changes to the Disclosure Requirements for Defined Benefit Plans—In August 2018, the FASB issued updated guidance which modifies the disclosure requirements regarding defined benefit plans and other postretirement plans. The updated guidance eliminates or clarifies certain currently required disclosures and includes additional requirements. The new guidance is effective for annual and interim reporting periods beginning after December 15, 2020, with early adoption permitted. A retrospective application is required. The Company is currently evaluating the new guidance.

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Revenue Recognition

6 Months Ended

Jun. 30, 2019

Revenue Recognition [Abstract]

Revenue Recognition

3. REVENUE RECOGNITION

Investment Banking and Other Advisory Fees—Fees for Financial Advisory services are recorded when: (i) a contract with a client has been identified, (ii) the performance obligations in the contract have been identified, (iii) the fee or other transaction price has been determined, (iv) the fee or other transaction price has been allocated to each performance obligation in the contract, and (v) the Company has satisfied the applicable performance obligation. The expenses that are directly related to such transactions are recorded as incurred and presented within operating expenses when the Company is primarily responsible for fulfilling the promise of the arrangement. Revenues associated with the reimbursement of such expenses are recorded when the Company is contractually entitled to reimbursement and presented within investment banking and other advisory fees.

Asset Management Fees—Fees for Asset Management services are primarily comprised of management fees and incentive fees. Management fees are derived from fees for investment management and other services provided to clients. Revenue is recorded in accordance with the same five criteria as Financial Advisory fees, which generally results in management fees being recorded on a daily, monthly or quarterly basis, primarily based on a percentage of client assets managed.  Fees vary with the type of assets managed, with higher fees earned on equity assets, alternative investment (such as hedge fund) and private equity funds, and lower fees earned on fixed income and money market products.  Expenses that are directly related to the sale or distribution of fund interests are recorded as incurred and presented within operating expenses when the Company is primarily responsible for fulfilling the promise of the arrangement.  Revenues associated with the reimbursement of such expenses are recorded when the Company is contractually entitled to reimbursement and presented within asset management fees.

In addition, the Company earns performance-based incentive fees on various investment products, including traditional products and alternative investment funds such as hedge funds and private equity funds.  

For hedge funds, incentive fees are calculated based on a specific percentage of a fund’s net appreciation, in some cases in excess of established benchmarks or thresholds.  The Company records incentive fees on traditional products and hedge funds when a significant reversal in the amount of the cumulative revenue to be recognized is not probable, which is typically at the end of the relevant performance measurement period. The incentive fee measurement period is generally an annual period (unless an account is terminated during the year).  The incentive fees received at the end of the measurement period are not subject to reversal or payback.  Incentive fees on hedge funds generally are subject to loss carryforward provisions in which losses incurred by the hedge funds in any year are applied against certain gains realized by the hedge funds in future periods before any incentive fees can be earned.

For private equity funds, incentive fees may be earned in the form of a “carried interest” if profits arising from realized investments exceed a specified threshold. Typically, such carried interest is ultimately calculated on a whole-fund basis and, therefore, clawback of carried interests during the life of the fund can occur. As a result, the Company records incentive fees earned on our private equity funds when a significant reversal in the amount of the cumulative revenue to be recognized is not probable, which is typically at the end of the relevant performance period.

Receivables relating to asset management and incentive fees are reported in “fees receivable” on the consolidated statements of financial condition.

The Company disaggregates revenue based on its business segment results and believes that the following information provides a reasonable representation of how performance obligations relate to the nature, amount, timing and uncertainty of revenue and cash flows:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2019		2018		2019		2018
Net Revenue:
Financial Advisory (a)	$	329,612	$	422,089	$	667,982	$	831,210
Asset Management:
Management Fees and Other (b)	$	310,316	$	340,160	$	611,569	$	688,844
Incentive Fees (c)		5,275		12,428		5,855		18,027
Total Asset Management	$	315,591	$	352,588	$	617,424	$	706,871

(a) Financial Advisory is comprised of M&A Advisory, Capital Advisory, Capital Raising, Restructuring, Shareholder Advisory, Sovereign Advisory, and other strategic advisory work for clients. The benefits of these advisory services are generally transferred to the Company’s clients over time, and consideration for these advisory services typically includes transaction completion, transaction announcement and retainer fees. Retainer fees are generally fixed and recognized over the period in which the advisory services are performed. However, transaction announcement and transaction completion fees are variable and subject to constraints, and they are typically not recognized until there is an announcement date or a completion date, respectively, due to the uncertainty associated with those events. Therefore, in any given period, advisory fees recognized for certain transactions will relate to services performed in prior periods. The advisory fees that may be unrecognized as of the end of a reporting period, primarily comprised of fees associated with transaction announcements and transaction completions, generally remain unrecognized due to the uncertainty associated with those events.

(b) Management fees and other is primarily comprised of management services. The benefits of these management services are transferred to the Company’s clients over time. Consideration for these management services generally includes management fees, which are based on assets under management and recognized over the period in which the management services are performed. The selling or distribution of fund interests is a separate performance obligation within management fees and other, and the benefits of such services are transferred to the Company’s clients at the point in time that such fund interests are sold or distributed.

(c) Incentive fees is primarily comprised of management services. The benefits of these management services are transferred to the Company’s clients over time. Consideration for these management services is generally variable and includes performance or incentive fees. The fees allocated to these management services that are unrecognized as of the end of the reporting period are generally amounts that are subject to constraints due to the uncertainty associated with performance targets and clawbacks.

In addition to the above, contracts with clients include trade-based commission income, which is recognized at the point in time of execution and presented within other revenue. Such income may be earned by providing trade facilitation, execution, clearance and settlement, custody, and trade administration services to clients.

With regard to the disclosure requirement for remaining performance obligations, the Company elected the practical expedients permitted in the guidance to (i) exclude contracts with a duration of one year or less; and (ii) exclude variable consideration, such as transaction completion and transaction announcement fees, that is allocated entirely to unsatisfied performance obligations. Excluded variable consideration typically relates to contracts with a duration of one year or less, and is generally constrained due to uncertainties. Therefore, when applying the practical expedients, amounts related to remaining performance obligations are not material to the Company’s financial statements.

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Receivables

6 Months Ended

Jun. 30, 2019

Receivables [Abstract]

Receivables

4. RECEIVABLES

The Company’s receivables represent fee receivables, amounts due from customers and other receivables.

Receivables are stated net of an estimated allowance for doubtful accounts, for past due amounts and for specific accounts deemed uncollectible, which may include situations where a fee is in dispute.

Activity in the allowance for doubtful accounts for the three month and six month periods ended June 30, 2019 and 2018 was as follows:

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2019			2018			2019			2018
Beginning Balance	$	43,258		$	38,557		$	40,164		$	23,746
Bad debt expense, net of recoveries		(9,380	)		666			(5,551	)		16,618
Charge-offs, foreign currency translation and other    adjustments		(343	)		(4,267	)		(1,078	)		(5,408	)
Ending Balance	$	33,535		$	34,956		$	33,535		$	34,956

Bad debt expense, net of recoveries is included in “operating expenses—other” on the condensed consolidated statements of operations.

At June 30, 2019 and December 31, 2018, the Company had receivables past due or deemed uncollectible of $45,516 and $42,309, respectively.

Of the Company’s fee receivables at June 30, 2019 and December 31, 2018, $79,426 and $90,966, respectively, represented interest-bearing financing receivables. Based upon our historical loss experience, the credit quality of the counterparties, and the lack of past due or uncollectible amounts, there was no allowance for doubtful accounts required at those dates related to such receivables.

The aggregate carrying amount of our non-interest bearing receivables of $625,688 and $594,568 at June 30, 2019 and December 31, 2018, respectively, approximates fair value.

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Investments

6 Months Ended

Jun. 30, 2019

Investments Schedule [Abstract]

Investments

5. INVESTMENTS

The Company’s investments and securities sold, not yet purchased, consist of the following at June 30, 2019 and December 31, 2018:

	June 30,		December 31,
	2019		2018
Interest-bearing deposits	$	511	$	510
Debt		124,838		202,874
Equities		37,858		32,261
Funds:
Alternative investments (a)		42,000		17,752
Debt (a)		104,756		90,320
Equity (a)		223,593		175,088
Private equity		41,868		56,343
		412,217		339,503
Total investments		575,424		575,148
Less:
Interest-bearing deposits		511		510
Investments, at fair value	$	574,913	$	574,638
Securities sold, not yet purchased, at fair value    (included in “other liabilities”)	$	2,261	$	3,929

(a) Interests in alternative investment funds, debt funds and equity funds include investments with fair values of $9,665, $75,364 and $172,711, respectively, at June 30, 2019 and $9,741, $60,081 and $132,038, respectively, at December 31, 2018, held in order to satisfy the Company’s liability upon vesting of previously granted Lazard Fund Interests (“LFI”) and other similar deferred compensation arrangements. LFI represent grants by the Company to eligible employees of actual or notional interests in a number of Lazard-managed funds, subject to service-based vesting conditions (see Notes 7 and 14).

Interest-bearing deposits have original maturities of greater than three months but equal to or less than one year and are carried at cost that approximates fair value due to their short-term maturities.

Debt primarily consists of U.S. Treasury securities with original maturities of greater than three months and less than one year.

Equities primarily consist of seed investments invested in marketable equity securities of large-, mid- and small-cap domestic, international and global companies held within separately managed accounts related to our Asset Management business.

Alternative investment funds primarily consist of interests in various Lazard-managed hedge funds, funds of funds and mutual funds. Such amounts primarily consist of seed investments in funds related to our Asset Management business and amounts related to LFI discussed above.

Debt funds primarily consist of seed investments in funds related to our Asset Management business that invest in debt securities, amounts related to LFI discussed above and an investment in a Lazard-managed debt fund.

Equity funds primarily consist of seed investments in funds related to our Asset Management business that invest in equity securities, and amounts related to LFI discussed above.

Private equity investments include those owned by Lazard and those consolidated but not owned by Lazard. Private equity investments owned by Lazard are primarily comprised of investments in private equity funds. Such investments primarily include (i) Edgewater Growth Capital Partners III, L.P. (“EGCP III”), a fund primarily making equity and buyout investments in middle market companies and (ii) a fund targeting significant noncontrolling-stake investments in established private companies.

Private equity investments consolidated but not owned by Lazard relate to the economic interests that are owned by the management team and other investors in the Edgewater Funds (“Edgewater”).

During the three month and six month periods ended June 30, 2019 and 2018, the Company reported in “revenue-other” on its condensed consolidated statements of operations net unrealized investment gains and losses pertaining to “equity securities and trading debt securities” still held as of the reporting date as follows:

	Three Months Ended					Six Months Ended
	June 30,					June 30,
	2019		2018			2019		2018
Net unrealized investment gains (losses)	$	7,229	$	(5,864	)	$	27,152	$	(15,155	)

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Fair Value Measurements

6 Months Ended

Jun. 30, 2019

Fair Value Disclosures [Abstract]

Fair Value Measurements

6. FAIR VALUE MEASUREMENTS

Fair Value Hierarchy of Investments and Certain Other Assets and Liabilities—Lazard categorizes its investments and certain other assets and liabilities recorded at fair value into a three-level fair value hierarchy as follows:

Level 1. Assets and liabilities whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market that Lazard has the ability to access.

Level 2. Assets and liabilities whose values are based on (i) quoted prices for similar assets or liabilities in an active market, or quoted prices for identical or similar assets or liabilities in non-active markets, or (ii) inputs other than quoted prices that are directly observable or derived principally from, or corroborated by, market data.

Level 3. Assets and liabilities whose values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. These inputs reflect our own assumptions about the assumptions a market participant would use in pricing the asset or liability. Items included in Level 3 include securities or other financial assets whose trading volume and level of activity have significantly decreased when compared with normal market activity and there is no longer sufficient frequency or volume to provide pricing information on an ongoing basis.

The fair value of debt is classified as Level 1 when the fair values are based on unadjusted quoted prices in active markets.

The fair value of equities is classified as Level 1 or Level 3 as follows: marketable equity securities are classified as Level 1 and are valued based on the last trade price on the primary exchange for that security as provided by external pricing services; equity securities in private companies are generally classified as Level 3.

The fair value of investments in alternative investment funds, debt funds and equity funds is classified as Level 1 when the fair values are primarily based on the publicly reported closing price for the fund.

The fair value of investments in private equity funds is classified as Level 3 for certain investments that are valued based on the potential transaction value as of June 30, 2019.

The fair value of securities sold, not yet purchased, is classified as Level 1 when the fair values are based on unadjusted quoted prices in active markets.

The fair value of the contingent consideration liability is classified as Level 3 and the fair value of the liability is remeasured at each reporting period. The inputs used to derive the fair value of the contingent consideration include the application of probabilities when assessing certain performance thresholds for the relevant periods. Any change in the fair value is recognized in “amortization and other acquisition-related (benefits) costs” in the condensed consolidated statement of operations. Our business acquisitions may involve the potential payment of contingent consideration upon the achievement of certain performance thresholds. The contingent consideration liability is initially recorded at fair value of the contingent payments on the acquisition date and is included in “other liabilities” on the condensed consolidated statements of financial condition. See Note 12.

The fair value of derivatives entered into by the Company is classified as Level 2 and is based on the values of the related underlying assets, indices or reference rates as follows: the fair value of forward foreign currency exchange rate contracts is a function of the spot rate and the interest rate differential of the two currencies from the trade date to settlement date; the fair value of total return swaps is based on the change in fair value of the related underlying equity security, financial instrument or index and a specified notional holding; the fair value of interest rate swaps is based on the interest rate yield curve; and the fair value of derivative liabilities related to LFI and other similar deferred compensation arrangements is based on the value of the underlying investments, adjusted for forfeitures. See Note 7.

Investments Measured at Net Asset Value (“NAV”)—As a practical expedient, the Company uses NAV or its equivalent to measure the fair value of certain investments. NAV is primarily determined based on information provided by external fund administrators. The Company’s investments valued at NAV as a practical expedient in (i) alternative investment funds, debt funds and equity funds are redeemable in the near term, and (ii) private equity funds are not redeemable in the near term as a result of redemption restrictions.

The following tables present, as of June 30, 2019 and December 31, 2018, the classification of (i) investments and certain other assets and liabilities measured at fair value on a recurring basis within the fair value hierarchy and (ii) investments measured at NAV or its equivalent as a practical expedient:

	June 30, 2019
	Level 1		Level 2		Level 3		NAV		Total
Assets:
Investments:
Debt	$	124,838	$	-	$	-	$	-	$	124,838
Equities		36,252		-		1,606		-		37,858
Funds:
Alternative investments		17,196		-		-		24,804		42,000
Debt		104,749		-		-		7		104,756
Equity		223,554		-		-		39		223,593
Private equity		-		-		2,131		39,737		41,868
Derivatives		-		2,180		-		-		2,180
Total	$	506,589	$	2,180	$	3,737	$	64,587	$	577,093
Liabilities:
Securities sold, not yet purchased	$	2,261	$	-	$	-	$	-	$	2,261
Contingent consideration liability		-		-		4,386		-		4,386
Derivatives		-		235,504		-		-		235,504
Total	$	2,261	$	235,504	$	4,386	$	-	$	242,151

	December 31, 2018
	Level 1		Level 2		Level 3		NAV		Total
Assets:
Investments:
Debt	$	202,874	$	-	$	-	$	-	$	202,874
Equities		30,639		-		1,622		-		32,261
Funds:
Alternative investments		16,863		-		-		889		17,752
Debt		90,313		-		-		7		90,320
Equity		175,054		-		-		34		175,088
Private equity		-		-		-		56,343		56,343
Derivatives		-		11,967		-		-		11,967
Total	$	515,743	$	11,967	$	1,622	$	57,273	$	586,605
Liabilities:
Securities sold, not yet purchased	$	3,929	$	-	$	-	$	-	$	3,929
Contingent consideration liability		-		-		10,009		-		10,009
Derivatives		-		188,962		-		-		188,962
Total	$	3,929	$	188,962	$	10,009	$	-	$	202,900

The following tables provide a summary of changes in fair value of the Company’s Level 3 assets and liabilities for the three month and six month periods ended June 30, 2019 and 2018:

	Three Months Ended June 30, 2019
	Beginning Balance		Net Unrealized/ Realized Gains/Losses Included In Earnings (a)			Purchases/ Acquisitions/ Transfers (b)		Sales/ Dispositions/ Settlements			Foreign Currency Translation Adjustments		Ending Balance
Assets:
Investments:
Equities	$	1,618	$	(12	)	$	-	$	-		$	-	$	1,606
Private equity funds		-		-			2,131		-			-		2,131
Total Level 3 Assets	$	1,618	$	(12	)	$	2,131	$	-		$	-	$	3,737
Liabilities:
Contingent consideration liability	$	13,048	$	4,611		$	-	$	(13,273	)	$	-	$	4,386
Total Level 3 Liabilities	$	13,048	$	4,611		$	-	$	(13,273	)	$	-	$	4,386

	Six Months Ended June 30, 2019
	Beginning Balance		Net Unrealized/ Realized Gains/Losses Included In Earnings (a)			Purchases/ Acquisitions/ Transfers (b)		Sales/ Dispositions/ Settlements			Foreign Currency Translation Adjustments			Ending Balance
Assets:
Investments:
Equities	$	1,622	$	(14	)	$	-	$	-		$	(2	)	$	1,606
Private equity funds		-		-			2,131		-			-			2,131
Total Level 3 Assets	$	1,622	$	(14	)	$	2,131	$	-		$	(2	)	$	3,737
Liabilities:
Contingent consideration liability	$	10,009	$	7,650		$	-	$	(13,273	)	$	-		$	4,386
Total Level 3 Liabilities	$	10,009	$	7,650		$	-	$	(13,273	)	$	-		$	4,386

	Three Months Ended June 30, 2018
	Beginning Balance		Net Unrealized/ Realized Gains/Losses Included In Earnings (a)			Purchases/ Acquisitions		Sales/ Dispositions/ Settlements		Foreign Currency Translation Adjustments			Ending Balance
Assets:
Investments:
Equities	$	1,599	$	62		$	-	$	-	$	(32	)	$	1,629
Total Level 3 Assets	$	1,599	$	62		$	-	$	-	$	(32	)	$	1,629
Liabilities:
Contingent consideration liability	$	28,974	$	(9,346	)	$	-	$	-	$	-		$	19,628
Total Level 3 Liabilities	$	28,974	$	(9,346	)	$	-	$	-	$	-		$	19,628

	Six Months Ended June 30, 2018
	Beginning Balance		Net Unrealized/ Realized Gains/Losses Included In Earnings (a)			Purchases/ Acquisitions		Sales/ Dispositions/ Settlements		Foreign Currency Translation Adjustments			Ending Balance
Assets:
Investments:
Equities	$	1,592	$	61		$	1	$	-	$	(25	)	$	1,629
Total Level 3 Assets	$	1,592	$	61		$	1	$	-	$	(25	)	$	1,629
Liabilities:
Contingent consideration liability	$	28,941	$	(9,313	)	$	-	$	-	$	-		$	19,628
Total Level 3 Liabilities	$	28,941	$	(9,313	)	$	-	$	-	$	-		$	19,628

(a) Earnings recorded in “other revenue” for investments in equities for the three month and six month periods ended June 30, 2019 and the three month and six month periods ended June 30, 2018 include net unrealized gains (losses) of $(12), $(14), $62 and $61, respectively. Earnings recorded in “amortization and other acquisition-related (benefits) costs” for the contingent consideration liability for the three month and six month periods ended June 30, 2019 and the three month and six month periods ended June 30, 2018 include unrealized (gains) losses of $4,611, $7,650, $(9,346) and $(9,313), respectively.

(b) Certain investments that were valued at NAV as of December 31, 2018 were transferred to Level 3 during the three month and six month periods ended June 30, 2019 as these investments are valued based on a potential transaction value that differs from NAV.

There were no transfers between any of the Level 1, 2 and 3 categories in the fair value measurement hierarchy during the three month and six month periods ended June 30, 2019 and 2018.

The following tables present, at June 30, 2019 and December 31, 2018, certain investments that are valued using NAV or its equivalent as a practical expedient in determining fair value:

June 30, 2019

Estimated Liquidation Period of Investments Not Redeemable

Investments Redeemable

Fair Value

Unfunded Commitments

% of Fair Value Not Redeemable

% Next 5 Years

% 5-10 Years

% Thereafter

Redemption Frequency

Redemption Notice Period

Alternative investment funds:

Hedge funds

$

24,183

$

-

NA

NA

NA

NA

(a)

30-60 days

Funds of funds

24

-

NA

NA

NA

NA

(b)

>90 days

Other

597

-

NA

NA

NA

NA

(c)

<30-30 days

Debt funds

7

-

NA

NA

NA

NA

(d)

<30 days

Equity funds

39

-

NA

NA

NA

NA

(e)

<30-90 days

Private equity funds:

Equity growth

39,737

8,264

(f)

100

%

19

%

14

%

67

%

NA

NA

Total

$

64,587

$

8,264

(a) monthly (100%)

(b) quarterly (100%)

(c) daily (6%) and monthly (94%)

(d) daily (100%)

(e) daily (23%), monthly (72%) and annually (5%)

(f) Unfunded commitments to private equity investments consolidated but not owned by Lazard of $13,400 are excluded. Such commitments are required to be funded by capital contributions from noncontrolling interest holders.

December 31, 2018

Estimated Liquidation Period of Investments Not Redeemable

Investments Redeemable

Fair Value

Unfunded Commitments

% of Fair Value Not Redeemable

% Next 5 Years

% 5-10 Years

% Thereafter

Redemption Frequency

Redemption Notice Period

Alternative investment funds:

Hedge funds

$

299

$

-

NA

NA

NA

NA

(a)

30-60 days

Funds of funds

23

-

NA

NA

NA

NA

(b)

>90 days

Other

567

-

NA

NA

NA

NA

(c)

<30-30 days

Debt funds

7

-

NA

NA

NA

NA

(d)

<30 days

Equity funds

34

-

NA

NA

NA

NA

(e)

<30-90 days

Private equity funds:

Equity growth

56,343

8,338

(f)

100

%

14

%

34

%

52

%

NA

NA

Total

$

57,273

$

8,338

(a) monthly (100%)   

(b) quarterly (100%)

(c) daily (6%) and monthly (94%)

(d) daily (100%)

(e) daily (25%), monthly (70%) and annually (5%)

(f) Unfunded commitments to private equity investments consolidated but not owned by Lazard of $14,437 are excluded. Such commitments are required to be funded by capital contributions from noncontrolling interest holders.

Investment Capital Funding Commitments—At June 30, 2019, the Company’s maximum unfunded commitments for capital contributions to investment funds primarily arose from commitments to EGCP III, which amounted to $7,602. The investment period for EGCP III ended on October 12, 2016, after which point the Company’s obligation to fund capital contributions for new investments in EGCP III expired. The Company remains obligated until October 12, 2023 (or any earlier liquidation of EGCP III) to make capital contributions necessary to fund follow-on investments and to pay for fund expenses.

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Derivatives

6 Months Ended

Jun. 30, 2019

Derivative Instruments And Hedging Activities Disclosure [Abstract]

Derivatives

7. DERIVATIVES

The Company enters into forward foreign currency exchange rate contracts, interest rate swaps, interest rate futures, total return swap contracts on various equity and debt indices and other derivative contracts to economically hedge exposures to fluctuations in currency exchange rates, interest rates and equity and debt prices. The Company reports its derivative instruments separately as assets and liabilities unless a legal right of set-off exists under a master netting agreement enforceable by law. The Company’s derivative instruments are recorded at their fair value, and are included in “other assets” and “other liabilities” on the condensed consolidated statements of financial condition. Gains and losses on the Company’s derivative instruments are generally included in “interest income” and “interest expense”, respectively, or “revenue-other”, depending on the nature of the underlying item, in the condensed consolidated statements of operations.

In addition to the derivative instruments described above, the Company records derivative liabilities relating to its obligations pertaining to LFI and other similar deferred compensation arrangements, the fair value of which is based on the value of the underlying investments, adjusted for estimated forfeitures, and is included in “accrued compensation and benefits” in the condensed consolidated statements of financial condition. Changes in the fair value of the derivative liabilities are included in “compensation and benefits” in the condensed consolidated statements of operations, the impact of which equally offsets the changes in the fair value of investments which are currently expected to be delivered upon settlement of LFI and other similar deferred compensation arrangements, which are reported in “revenue-other” in the condensed consolidated statements of operations.

The table below presents the fair value of the Company’s derivative instruments reported within “other assets” and “other liabilities” and the fair value of the Company’s derivative liabilities relating to its obligations pertaining to LFI and other similar deferred compensation arrangements reported within “accrued compensation and benefits” (see Note 13) on the accompanying condensed consolidated statements of financial condition as of June 30, 2019 and December 31, 2018:

	June 30,		December 31,
	2019		2018
Derivative Assets:
Forward foreign currency exchange rate contracts	$	2,180	$	1,543
Total return swaps and other (a)		-		10,424
	$	2,180	$	11,967
Derivative Liabilities:
Forward foreign currency exchange rate contracts	$	1,442	$	939
Total return swaps and other (a)		4,626		1
LFI and other similar deferred compensation arrangements		229,436		188,022
	$	235,504	$	188,962

(a) For total return swaps, amounts represent the netting of gross derivative assets and liabilities of $139 and $4,765 as of June 30, 2019, respectively, and $10,792 and $369 as of December 31, 2018, respectively, for contracts with the same counterparty under legally enforceable master netting agreements. Such amounts are recorded “net” in “other assets”, with receivables for net cash collateral under such contracts of $5,950 as of June 30, 2019.

Net gains (losses) with respect to derivative instruments (predominantly reflected in “revenue-other”) and the Company’s derivative liabilities relating to its obligations pertaining to LFI and other similar deferred compensation arrangements (included in “compensation and benefits” expense) as reflected on the accompanying condensed consolidated statements of operations for the three month and six month periods ended June 30, 2019 and 2018, were as follows:

	Three Months Ended					Six Months Ended
	June 30,					June 30,
	2019			2018		2019			2018
Forward foreign currency exchange rate contracts	$	(3,424	)	$	6,236	$	1,096		$	3,753
LFI and other similar deferred compensation arrangements		(6,484	)		499		(20,354	)		1,935
Total return swaps and other		(1,976	)		790		(9,633	)		2,446
Total	$	(11,884	)	$	7,525	$	(28,891	)	$	8,134

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Property

6 Months Ended

Jun. 30, 2019

Property Plant And Equipment [Abstract]

Property

8. PROPERTY

At June 30, 2019 and December 31, 2018, property consisted of the following:

	Estimated Depreciable		June 30,		December 31,
	Life in Years		2019		2018
Buildings		33	$	144,148	$	145,034
Leasehold improvements	3-20			188,736		188,956
Furniture and equipment	3-10			205,607		204,585
Construction in progress				19,084		14,141
Total				557,575		552,716
Less - Accumulated depreciation and amortization				351,119		339,770
Property			$	206,456	$	212,946

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Leases

6 Months Ended

Jun. 30, 2019

Leases [Abstract]

Leases

9. LEASES

The Company adopted the new lease accounting guidance as of January 1, 2019, which resulted in recognition of ROU assets and lease liabilities related to operating leases on the condensed consolidated statements of financial condition. The Company determines if an arrangement is, or contains, a lease at its inception and reevaluates the arrangement if the terms are modified. Operating lease ROU assets represent the right to use an underlying asset for the lease term and operating lease liabilities reflect the obligation to make lease payments arising from the lease. At any given time during the lease term, the operating lease liability represents the present value of the remaining lease payments and the operating lease ROU asset is measured at the amount of the lease liability, adjusted for rent prepayments, unamortized initial direct costs and the remaining balance of lease incentives received. Both the operating lease ROU asset and the operating lease liability are reduced to zero at the end of the lease.

The Company leases office space and equipment under non-cancelable lease agreements, which expire on various dates through 2033. Substantially all of these arrangements are operating leases relating to office space. Certain leases have renewal options that can be exercised at the discretion of the Company. The Company only includes renewal options in the lease term when it is reasonably certain to exercise the option. The Company does not record leases with a lease term of 12 months or less on the condensed consolidated statements of financial condition; lease expense for these leases is recognized over the lease term on a straight-line basis.

For leases commencing on January 1, 2019 or thereafter that are recognized on the condensed consolidated statements of financial condition, the Company applies its estimated Discount. The Company bases this Discount on the information available at the lease commencement date. The Company determines its Discount with consideration of the Company’s public debt issuances as well as publicly available data for instruments with similar characteristics.

For leases commencing on January 1, 2019 or thereafter that relate to office space and equipment, the Company accounts for the lease and non-lease components as a single lease component.

In addition to rent payments, operating leases for office space generally contain payments for real estate taxes, insurance costs, common area maintenance, and utilities that are not fixed. The Company accounts for these costs as variable payments and does not include them in the lease component. There are certain office leases outside of the U.S. that have annual rent increases that are also accounted for as variable payments and are excluded from the lease component.

The following table summarizes the components of operating lease expense reflected on the accompanying condensed consolidated statements of operations for the three month and six month periods ended June 30, 2019:

	Three Months Ended		Six Months Ended
	June 30, 2019		June 30, 2019
Operating lease cost	$	18,910	$	38,900
Variable lease cost		4,802		9,051
Less - sublease income		1,692		3,462
Total	$	22,020	$	44,489

The following table summarizes the supplemental cash flow information and certain other information related to operating leases for the six month period ended June 30, 2019:

	Six Months Ended
	June 30, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	39,759
Operating lease right-of-use assets obtained in exchange for operating lease liabilities	$	504,706
Weighted average remaining lease term	12 years
Weighted average discount rate		4.1	%

Maturities of the operating lease liabilities outstanding at June 30, 2019 for each of the years in the period ending December 31, 2024 and thereafter are set forth in the table below.

Year Ending December 31,
2019 (July 1 through December 31)	$	39,879
2020		76,856
2021		72,870
2022		56,879
2023		52,228
2024		51,045
Thereafter		360,876
Total lease payments		710,633
Less -  Discount		155,309
Operating lease liabilities	$	555,324

Prior to the adoption of the new lease accounting guidance, the minimum rental commitments under non-cancelable operating leases at December 31, 2018, net of sublease income, were approximately as follows:

Year Ending December 31,
2019	$	86,839
2020		89,445
2021		83,701
2022		70,780
2023		59,973
Thereafter		488,612
Total minimum rental commitments		879,350
Less - sublease proceeds		26,941
Net rental commitments	$	852,409

In August 2018, the Company entered into a lease agreement for additional office facilities, which are currently under construction. The lease is expected to commence in the third quarter of 2019 when the facilities are delivered to the Company. The Company will recognize the related operating lease right-of-use assets and the operating lease liability on the lease commencement date. Operating lease commitments in the December 2018 table above include the impact of the new lease agreement.

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Goodwill and Other Intangible Assets

6 Months Ended

Jun. 30, 2019

Goodwill And Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangible Assets

10. GOODWILL AND OTHER INTANGIBLE ASSETS

The components of goodwill and other intangible assets at June 30, 2019 and December 31, 2018 are presented below:

	June 30,		December 31,
	2019		2018
Goodwill	$	371,536	$	371,561
Other intangible assets (net of accumulated    amortization)		2,900		3,757
	$	374,436	$	375,318

At June 30, 2019 and December 31, 2018, goodwill of $306,995 and $307,020, respectively, was attributable to the Company’s Financial Advisory segment and, at each such respective date, $64,541 of goodwill was attributable to the Company’s Asset Management segment.

Changes in the carrying amount of goodwill for the six month periods ended June 30, 2019 and 2018 are as follows:

	Six Months Ended
	June 30,
	2019			2018
Balance, January 1	$	371,561		$	385,292
Foreign currency translation adjustments		(25	)		(8,028	)
Balance, June 30	$	371,536		$	377,264

All changes in the carrying amount of goodwill for the six month periods ended June 30, 2019 and 2018 are attributable to the Company’s Financial Advisory segment.

The gross cost and accumulated amortization of other intangible assets as of June 30, 2019 and December 31, 2018, by major intangible asset category, are as follows:

	June 30, 2019						December 31, 2018
	Gross Cost		Accumulated Amortization		Net Carrying Amount		Gross Cost		Accumulated Amortization		Net Carrying Amount
Success/incentive fees	$	35,322	$	33,075	$	2,247	$	35,232	$	32,235	$	2,997
Management fees, customer relationships and    non-compete agreements		34,486		33,833		653		34,474		33,714		760
	$	69,808	$	66,908	$	2,900	$	69,706	$	65,949	$	3,757

Amortization expense of intangible assets, included in “amortization and other acquisition-related (benefits) costs” in the condensed consolidated statements of operations, for the three month and six month periods ended June 30, 2019 was $431 and $862, respectively, and for the three month and six month periods ended June 30, 2018 was $863 and $1,696, respectively. Estimated future amortization expense is as follows:

Year Ending December 31,	Amortization Expense
2019 (July 1 through December 31)	$	862
2020		1,700
2021		150
2022		150
2023		38
Total amortization expense	$	2,900

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Senior Debt

6 Months Ended

Jun. 30, 2019

Debt Disclosure [Abstract]

Senior Debt

11. SENIOR DEBT

Senior debt is comprised of the following as of June 30, 2019 and December 31, 2018:

							Outstanding as of
	Initial			Annual			June 30, 2019						December 31, 2018
	Principal Amount		Maturity Date	Interest Rate(b)			Principal		Unamortized Debt Costs		Carrying Value		Principal		Unamortized Debt Costs		Carrying Value
Lazard Group 2020    Senior Notes (a)	$	500,000	11/14/20		4.25	%	$	-	$	-	$	-	$	250,000	$	863	$	249,137
Lazard Group 2025    Senior Notes		400,000	2/13/25		3.75	%		400,000		2,652		397,348		400,000		2,888		397,112
Lazard Group 2027    Senior Notes		300,000	3/1/27		3.625	%		300,000		3,018		296,982		300,000		3,215		296,785
Lazard Group 2028    Senior Notes		500,000	9/19/28		4.50	%		500,000		8,323		491,677		500,000		8,774		491,226
Lazard Group 2029    Senior Notes (a)		500,000	3/11/29		4.375	%		500,000		7,876		492,124		-		-		-
Total							$	1,700,000	$	21,869	$	1,678,131	$	1,450,000	$	15,740	$	1,434,260

(a) During March 2019, Lazard Group completed an offering of $500,000 aggregate principal amount of 4.375% senior notes due 2029 (the “2029 Notes”).  Interest on the 2029 Notes is payable semi-annually on March 11 and September 11 of each year, beginning September 11, 2019.  Lazard Group used a portion of the net proceeds of the 2029 Notes to redeem or otherwise retire $250,000 aggregate principal amount of the 4.25% senior notes due 2020 (the “2020 Notes”). In March 2019, $167,943 aggregate principal amount was redeemed or otherwise retired, and the remaining $82,057 was redeemed or otherwise retired in April 2019.

(b) The effective interest rates of Lazard Group’s 3.75% senior notes due February 13, 2025 (the “2025 Notes”), Lazard Group’s 3.625% senior notes due March 1, 2027 (the “2027 Notes”), Lazard Group’s 4.50% senior notes due September 19, 2028 (the “2028 Notes”) and the 2029 Notes are 3.87%, 3.76%, 4.68% and 4.54% respectively.

On September 25, 2015, Lazard Group entered into an Amended and Restated Credit Agreement for a five-year $150,000 senior revolving credit facility with a group of lenders (the “Amended and Restated Credit Agreement”), which expires in September 2020. The Amended and Restated Credit Agreement amended and restated the previous credit agreement dated September 25, 2012. Borrowings under the Amended and Restated Credit Agreement generally will bear interest at LIBOR plus an applicable margin for specific interest periods determined based on Lazard Group’s highest credit rating from an internationally recognized credit agency. At June 30, 2019 and December 31, 2018, no amounts were outstanding under the Amended and Restated Credit Agreement.

The Amended and Restated Credit Agreement, the indenture and the supplemental indentures relating to Lazard Group’s senior notes contain certain covenants, events of default and other customary provisions, including a customary make-whole provision in the event of early redemption, where applicable. As of June 30, 2019, the Company was in compliance with such provisions. All of the Company’s senior debt obligations are unsecured.

As of June 30, 2019, the Company had approximately $168,000 in unused lines of credit available to it, including the credit facility provided under the Amended and Restated Credit Agreement and unused lines of credit available to LFB of approximately $17,000.

The Company’s senior debt at June 30, 2019 and December 31, 2018 is carried at historical amounts of $1,678,131 and $1,434,260, respectively. At those dates, the fair value of such senior debt was approximately $1,782,000 and $1,429,000, respectively. The fair value of the Company’s senior debt is based on market quotations. The Company’s senior debt would be categorized within Level 2 of the hierarchy of fair value measurements if carried at fair value.

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Commitments and Contingencies

6 Months Ended

Jun. 30, 2019

Commitments And Contingencies Disclosure [Abstract]

Commitments and Contingencies

12. COMMITMENTS AND CONTINGENCIES

Guarantees—In the normal course of business, LFB provides indemnifications to third parties to protect them in the event of non-performance by its clients. At June 30, 2019, LFB had $3,469 of such indemnifications and held $3,469 of collateral/counter-guarantees to secure these commitments. The Company believes the likelihood of loss with respect to these indemnities is remote. Accordingly, no liability is recorded in the condensed consolidated statement of financial condition.

Business Acquisitions—For businesses acquired in 2016, the remaining consideration consists of (i) 40,524 shares of Class A common stock subject to non-compete provisions and employment conditions, and non-contingent interests exchangeable into 202,984 shares of Class A common stock, and (ii) up to 499,793 additional shares of Class A common stock that are subject to certain performance thresholds, as well as applicable related dividend equivalent amounts. During the six month period ended June 30, 2019, 368,635 of the contingent shares were earned, including dividend equivalent amounts.

Other Commitments—The Company has various other contractual commitments arising in the ordinary course of business. In addition, from time to time, each of LFB and LFNY may enter into underwriting commitments in which it will participate as an underwriter. At June 30, 2019, LFB and LFNY had no such underwriting commitments.

See Notes 6 and 15 for information regarding commitments relating to investment capital funding commitments and obligations to fund our pension plans, respectively.

In the opinion of management, the fulfillment of the commitments described herein will not have a material adverse effect on the Company’s condensed consolidated financial position or results of operations.

Legal—The Company is involved from time to time in judicial, regulatory and arbitration proceedings and inquiries concerning matters arising in connection with the conduct of our businesses, including proceedings initiated by former employees alleging wrongful termination. The Company reviews such matters on a case-by-case basis and establishes any required accrual if a loss is probable and the amount of such loss can be reasonably estimated. The Company experiences significant variation in its revenue and earnings on a quarterly basis. Accordingly, the results of any pending matter or matters could be significant when compared to the Company’s earnings in any particular fiscal quarter. The Company believes, however, based on currently available information, that the results of any pending matters, in the aggregate, will not have a material effect on its business or financial condition.

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Stockholders' Equity

6 Months Ended

Jun. 30, 2019

Equity [Abstract]

Stockholders' Equity

13. STOCKHOLDERS’ EQUITY

Share Repurchase Program—During the six month period ended June 30, 2019 and since 2017, the Board of Directors of Lazard authorized the repurchase of Class A common stock as set forth in the table below:

Date	Repurchase Authorization		Expiration
October 2017	$	200,000	December 31, 2019
April 2018	$	300,000	December 31, 2020
October 2018	$	300,000	December 31, 2020
February 2019	$	300,000	December 31, 2020

The Company expects that the share repurchase program will continue to be used to offset a portion of the shares that have been or will be issued under the Lazard Ltd 2008 Incentive Compensation Plan (the “2008 Plan”) and the Lazard Ltd 2018 Incentive Compensation Plan (the “2018 Plan”). Pursuant to the share repurchase program, purchases have been made in the open market or through privately negotiated transactions. The rate at which the Company purchases shares in connection with the share repurchase program may vary from quarter to quarter due to a variety of factors. Purchases with respect to such program are set forth in the table below:

Six Months Ended June 30:	Number of Shares Purchased		Average Price Per Share
2018		4,147,526	$	53.96
2019		9,715,003	$	36.20

During the six month periods ended June 30, 2019 and 2018, certain of our executive officers received Class A common stock in connection with the vesting or settlement of previously-granted deferred equity incentive awards. The vesting or settlement of such equity awards gave rise to a tax payable by the executive officers, and, consistent with our past practice, the Company purchased shares of Class A common stock from certain of our executive officers equal in value to all or a portion of the estimated amount of such tax. In addition, during the six month period ended June 30, 2018, the Company purchased shares of Class A common stock from certain of our executive officers. The aggregate value of all such purchases during the six month periods ended June 30, 2019 and 2018 was approximately $14,600 and $16,400, respectively. Such shares of Class A common stock are reported at cost.

As of June 30, 2019, a total of $243,800 of share repurchase authorization remained available under the Company’s share repurchase program, all of which will expire on December 31, 2020.

During the six month period ended June 30, 2019, the Company had in place trading plans under Rule 10b5-1 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), pursuant to which it effected stock repurchases in the open market.

Preferred Stock—Lazard Ltd has 15,000,000 authorized shares of preferred stock, par value $0.01 per share, inclusive of its Series A and Series B preferred stock. Series A and Series B preferred shares were issued in connection with certain prior year business acquisitions and were each non-participating securities convertible into Class A common stock, and had no voting or dividend rights. As of both June 30, 2019 and December 31, 2018, no shares of Series A or Series B preferred stock were outstanding.

Accumulated Other Comprehensive Income (Loss), Net of Tax—The tables below reflect the balances of each component of AOCI at June 30, 2019 and 2018 and activity during the three month and six month periods then ended:

	Three Months Ended June 30, 2019
	Currency Translation Adjustments			Employee Benefit Plans			Total AOCI			Amount Attributable to Noncontrolling Interests			Total Lazard Ltd AOCI
Balance, April 1, 2019	$	(126,357	)	$	(142,502	)	$	(268,859	)	$	(1	)	$	(268,858	)
Activity:
Other comprehensive income (loss) before    reclassifications		(7,053	)		2,812			(4,241	)		(2	)		(4,239	)
Adjustments for items reclassified to earnings,    net of tax		-			1,113			1,113			-			1,113
Net other comprehensive income (loss)		(7,053	)		3,925			(3,128	)		(2	)		(3,126	)
Balance, June 30, 2019	$	(133,410	)	$	(138,577	)	$	(271,987	)	$	(3	)	$	(271,984	)

	Six Months Ended June 30, 2019
	Currency Translation Adjustments			Employee Benefit Plans			Total AOCI			Amount Attributable to Noncontrolling Interests			Total Lazard Ltd AOCI
Balance, January 1, 2019	$	(130,137	)	$	(143,683	)	$	(273,820	)	$	(2	)	$	(273,818	)
Activity:
Other comprehensive income (loss) before    reclassifications		(3,273	)		2,861			(412	)		(1	)		(411	)
Adjustments for items reclassified to earnings,    net of tax		-			2,245			2,245			-			2,245
Net other comprehensive income (loss)		(3,273	)		5,106			1,833			(1	)		1,834
Balance, June 30, 2019	$	(133,410	)	$	(138,577	)	$	(271,987	)	$	(3	)	$	(271,984	)

	Three Months Ended June 30, 2018
	Currency Translation Adjustments			Employee Benefit Plans			Total AOCI			Amount Attributable to Noncontrolling Interests			Total Lazard Ltd AOCI
Balance, April 1, 2018	$	(66,189	)	$	(152,936	)	$	(219,125	)	$	(1	)	$	(219,124	)
Activity:
Other comprehensive income (loss) before    reclassifications		(43,453	)		8,300			(35,153	)		(1	)		(35,152	)
Adjustments for items reclassified to earnings,    net of tax		-			777			777			-			777
Net other comprehensive income (loss)		(43,453	)		9,077			(34,376	)		(1	)		(34,375	)
Balance, June 30, 2018	$	(109,642	)	$	(143,859	)	$	(253,501	)	$	(2	)	$	(253,499	)

	Six Months Ended June 30, 2018
	Currency Translation Adjustments			Employee Benefit Plans			Total AOCI			Amount Attributable to Noncontrolling Interests			Total Lazard Ltd AOCI
Balance, January 1, 2018	$	(83,535	)	$	(148,984	)	$	(232,519	)	$	(1	)	$	(232,518	)
Activity:
Other comprehensive income (loss) before    reclassifications		(26,107	)		3,286			(22,821	)		(1	)		(22,820	)
Adjustments for items reclassified to earnings,    net of tax		-			1,839			1,839			-			1,839
Net other comprehensive income (loss)		(26,107	)		5,125			(20,982	)		(1	)		(20,981	)
Balance, June 30, 2018	$	(109,642	)	$	(143,859	)	$	(253,501	)	$	(2	)	$	(253,499	)

The table below reflects adjustments for items reclassified out of AOCI, by component, for the three month and six month periods ended June 30, 2019 and 2018:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2019		2018		2019		2018
Amortization relating to employee benefit plans (a)	$	1,287	$	1,245	$	2,597	$	2,523
Less - related income taxes		174		468		352		684
Total reclassifications, net of tax	$	1,113	$	777	$	2,245	$	1,839

(a) Included in the computation of net periodic benefit cost (see Note 15). Such amounts are included in “operating expenses—other” on the condensed consolidated statements of operations.

Noncontrolling Interests—Noncontrolling interests principally represent (i) interests held in Edgewater’s management vehicles that the Company is deemed to control, but does not own, (ii) profits interest participation rights (see Note 14) and (iii) consolidated VIE interests held by employees (see Note 21).

The tables below summarize net income attributable to noncontrolling interests for the three month and six month periods ended June 30, 2019 and 2018 and noncontrolling interests as of June 30, 2019 and December 31, 2018 in the Company’s condensed consolidated financial statements:

	Net Income Attributable to Noncontrolling Interests
	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2019		2018		2019		2018
Edgewater	$	7,501	$	1,415	$	6,935	$	3,383
Consolidated VIEs		234		-		234		-
Other		1		1		1		2
Total	$	7,736	$	1,416	$	7,170	$	3,385

	Noncontrolling Interests as of
	June 30,		December 31,
	2019		2018
Edgewater	$	52,111	$	52,695
Profits interest participation rights		35,254		535
Consolidated VIEs		11,698		-
Other		13		12
Total	$	99,076	$	53,242

Dividends Declared, July 24, 2019—On July 24, 2019, the Board of Directors of Lazard declared a quarterly dividend of $0.47 per share on our Class A common stock. The dividend is payable on August 16, 2019, to stockholders of record on August 5, 2019.

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Incentive Plans

6 Months Ended

Jun. 30, 2019

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Incentive Plans

14. INCENTIVE PLANS

Share-Based Incentive Plan Awards

A description of Lazard Ltd’s 2018 Plan, 2008 Plan and 2005 Equity Incentive Plan (the “2005 Plan”) and activity with respect thereto during the three month and six month periods ended June 30, 2019 and 2018 is presented below.

Shares Available Under the 2018 Plan, 2008 Plan and 2005 Plan

The 2018 Plan became effective on April 24, 2018 and replaced the 2008 Plan, which was terminated on April 24, 2018. The 2018 Plan authorizes the issuance of up to 30,000,000 shares of Class A common stock pursuant to the grant or exercise of stock options, stock appreciation rights, restricted stock units (“RSUs”), performance-based restricted stock units (“PRSUs”), profits interest participation rights and other share-based awards.

The 2008 Plan authorized the issuance of shares of Class A common stock pursuant to the grant or exercise of stock options, stock appreciation rights, RSUs, PRSUs and other share-based awards. Under the 2008 Plan, the maximum number of shares available was based on a formula that limited the aggregate number of shares that could, at any time, be subject to awards that were considered “outstanding” under the 2008 Plan to 30% of the then-outstanding shares of Class A common stock. The 2008 Plan was terminated on April 24, 2018, and no additional awards have been or will be granted under the 2008 Plan after its termination, although outstanding awards granted under the 2008 Plan before its termination continue to be subject to its terms.

The 2005 Plan authorized the issuance of up to 25,000,000 shares of Class A common stock pursuant to the grant or exercise of stock options, stock appreciation rights, RSUs and other share-based awards. The 2005 Plan expired in the second quarter of 2015, although outstanding deferred stock unit (“DSU”) awards granted under the 2005 Plan before its expiration continue to be subject to its terms.

The following reflects the amortization expense recorded with respect to share-based incentive plans within “compensation and benefits” expense (with respect to RSUs, PRSUs and other share-based awards) and “professional services” expense (with respect to DSUs) within the Company’s accompanying condensed consolidated statements of operations for the three month and six month periods ended June 30, 2019 and 2018:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2019		2018		2019		2018
Share-based incentive awards:
RSUs	$	48,194	$	55,635	$	103,391	$	116,522
PRSUs		928		17,051		2,249		28,018
Restricted Stock		8,085		12,600		17,597		23,373
Profits interest participation rights		17,413		-		35,881		-
DSUs		1,782		1,724		1,965		1,917
Total	$	76,402	$	87,010	$	161,083	$	169,830

The ultimate amount of compensation and benefits expense relating to share-based awards is dependent upon the actual number of shares of Class A common stock that vest. The Company periodically assesses the forfeiture rates used for such estimates, including as a result of any applicable performance conditions. A change in estimated forfeiture rates or performance results in a cumulative adjustment to compensation and benefits expense and also would cause the aggregate amount of compensation expense recognized in future periods to differ from the estimated unrecognized compensation expense described below.

The Company’s share-based incentive plans and awards are described below.

RSUs and DSUs

RSUs generally require future service as a condition for the delivery of the underlying shares of Class A common stock (unless the recipient is then eligible for retirement under the Company’s retirement policy) and convert into shares of Class A common stock on a one-for-one basis after the stipulated vesting periods. The grant date fair value of the RSUs, net of an estimated forfeiture rate, is amortized over the vesting periods or requisite service periods (generally one-third after two years, and the remaining two-thirds after the third year), and is adjusted for actual forfeitures over such period.

RSUs generally include a dividend participation right that provides that during vesting periods each RSU is attributed additional RSUs (or fractions thereof) equivalent to any dividends paid on Class A common stock during such period. During the six month period ended June 30, 2019, dividend participation rights required the issuance of 566,194 RSUs and the associated charge to “retained earnings”, net of estimated forfeitures (with corresponding credits to “additional paid-in-capital”) was $20,142.

Non-executive members of the Board of Directors (“Non-Executive Directors”) receive approximately 55% of their annual compensation for service on the Board of Directors and its committees in the form of DSUs, which resulted in 51,192 DSUs granted during the six month period ended June 30, 2019.  Their remaining compensation is payable in cash, which they may elect to receive in the form of additional DSUs under the Directors’ Fee Deferral Unit Plan described below. DSUs are convertible into shares of Class A common stock at the time of cessation of service to the Board of Directors. DSUs include a cash dividend participation right equivalent to dividends paid on Class A common stock.

The Company’s Directors’ Fee Deferral Unit Plan permits the Non-Executive Directors to elect to receive additional DSUs in lieu of some or all of their cash fees. The number of DSUs granted to a Non-Executive Director pursuant to this election will equal the value of cash fees that the applicable Non-Executive Director has elected to forego pursuant to such election, divided by the market value of a share of Class A common stock on the date immediately preceding the date of the grant. During the six month period ended June 30, 2019, 10,257 DSUs had been granted pursuant to such Plan.

DSU awards are expensed at their fair value on their date of grant, inclusive of amounts related to the Directors’ Fee Deferral Unit Plan.

The following is a summary of activity relating to RSUs and DSUs during the six month period ended June 30, 2019:

	RSUs					DSUs
	Units			Weighted Average Grant Date Fair Value		Units		Weighted Average Grant Date Fair Value
Balance, January 1, 2019		11,362,306		$	43.78		323,546	$	39.27
Granted (including 566,194 RSUs relating to dividend    participation)		5,564,865		$	38.32		61,449	$	31.97
Forfeited		(368,195	)	$	42.68		-	$	-
Settled		(5,795,423	)	$	37.03		-	$	-
Balance, June 30, 2019		10,763,553		$	44.63		384,995	$	38.10

In connection with RSUs that settled during the six month period ended June 30, 2019, the Company satisfied its minimum statutory tax withholding requirements in lieu of delivering 2,023,986 shares of Class A common stock during such six month period. Accordingly, 3,771,437 shares of Class A common stock held by the Company were delivered during the six month period ended June 30, 2019.

As of June 30, 2019, estimated unrecognized RSU compensation expense was $195,263, with such expense expected to be recognized over a weighted average period of approximately 0.9 years subsequent to June 30, 2019.

Restricted Stock

The following is a summary of activity related to shares of restricted Class A common stock associated with compensation arrangements during the six month period ended June 30, 2019:

	Restricted Shares			Weighted Average Grant Date Fair Value
Balance, January 1, 2019		1,541,058		$	43.16
Granted		1,039,736		$	35.32
Forfeited		(194,097	)	$	41.28
Settled		(1,159,850	)	$	38.37
Balance, June 30, 2019		1,226,847		$	41.34

In connection with shares of restricted Class A common stock that settled during the six month period ended June 30, 2019, the Company satisfied its minimum statutory tax withholding requirements in lieu of delivering 370,777 shares of Class A common stock during such six month period. Accordingly, 789,073 shares of Class A common stock held by the Company were delivered during the six month period ended June 30, 2019.

The restricted stock awards include a cash dividend participation right equivalent to dividends paid on Class A common stock during the period, which will vest concurrently with the underlying restricted stock award. At June 30, 2019, estimated unrecognized restricted stock expense was $28,337, with such expense to be recognized over a weighted average period of approximately 1.0 years subsequent to June 30, 2019.

PRSUs

PRSUs are RSUs that are subject to both performance-based and service-based vesting conditions. The number of shares of Class A common stock that a recipient will receive upon vesting of a PRSU will be calculated by reference to certain performance metrics that relate to the Company’s performance over a three-year period. The target number of shares of Class A common stock subject to each PRSU is one; however, based on the achievement of the performance criteria, the number of shares of Class A common stock that may be received in connection with each PRSU generally can range from zero to two times the target number. PRSUs will vest on a single date approximately three years following the date of the grant, provided the applicable service and performance conditions are satisfied. In addition, the performance metrics applicable to each PRSU will be evaluated on an annual basis at the end of each fiscal year during the performance period and, if the Company has achieved a threshold level of performance with respect to the fiscal year, 25% of the target number of shares of Class A common stock subject to each PRSU will no longer be at risk of forfeiture based on the achievement of performance criteria. PRSUs include dividend participation rights that provide that during vesting periods, the target number of PRSUs (or, following the relevant performance period, the actual number of shares of Class A common stock that are no longer subject to performance conditions) receive dividend equivalents at the same rate that dividends are paid on Class A common stock during such periods. These dividend equivalents are credited as RSUs that are not subject to the performance-based vesting criteria but are otherwise subject to the same restrictions as the underlying PRSUs to which they relate.

The following is a summary of activity relating to PRSUs during the six month period ended June 30, 2019:

	PRSUs			Weighted Average Grant Date Fair Value
Balance, January 1, 2019		1,771,795		$	38.66
Settled		(1,171,081	)	$	32.44
Balance, June 30, 2019		600,714		$	50.78

In connection with certain PRSUs that settled during the six month period ended June 30, 2019, the Company satisfied its minimum statutory tax withholding requirements in lieu of delivering 203,036 shares of Class A common stock during such six month period. Accordingly, 968,045 shares of Class A common stock held by the Company were delivered during the six month period ended June 30, 2019.

Compensation expense recognized for PRSU awards is determined by multiplying the number of shares of Class A common stock underlying such awards that, based on the Company’s estimate, are considered probable of vesting, by the grant date fair value. As of June 30, 2019, the total estimated unrecognized compensation expense was $4,249, and the Company expects to amortize such expense over a weighted-average period of approximately 0.7 years subsequent to June 30, 2019.

Profits Interest Participation Rights

In early 2019, the Company established a new long-term incentive compensation program consisting of profits interest participation rights, which are equity incentive awards that, subject to certain conditions, may be exchanged for shares of Class A common stock pursuant to the 2018 Plan.  Pursuant to the program, in February 2019, the Company granted profits interest participation rights subject to service-based and performance-based vesting criteria and other conditions, which we refer to as performance-based restricted participation units (“PRPUs”), to each of the Company’s NEOs, and profits interest participation rights subject to service-based vesting criteria and other conditions to a limited number of other senior employees, pursuant to profits interest participation right agreements.  Profits interest participation rights generally provide for vesting approximately three years following the grant date, so long as applicable conditions have been satisfied.

Profits interest participation rights are a class of membership interests in Lazard Group that are intended to qualify as “profits interests” for U.S. federal income tax purposes, and are recorded as noncontrolling interests within stockholders’ equity in the Company’s condensed consolidated statements of financial condition until they are exchanged into Class A common stock, at which time there is a reclassification to additional paid-in-capital.  The profits interest participation rights generally allow the recipient to realize value only to the extent that both (i) the service-based vesting conditions and, if applicable, the performance conditions, are satisfied, and (ii) an amount of economic appreciation in the assets of Lazard Group occurs as necessary to satisfy certain partnership tax rules (referred to as the "Minimum Value Condition") before the fifth anniversary of the grant date, otherwise the profits interest participation rights will be forfeited.  Upon satisfaction of such conditions, profits interest participation rights that are in parity with the value of Class A common stock will be exchanged on a one-for-one basis for shares of Class A common stock. If forfeited based solely on failing to meet the Minimum Value Condition, the associated compensation expense would not be reversed.  

Like outstanding RSUs and similar awards, profits interest participation rights will be subject to continued employment and other conditions and restrictions and will be forfeited if those conditions and restrictions are not fulfilled. More specifically, vesting of profits interest participation rights will be subject to compliance with restrictive covenants including non-compete, non-solicitation of clients, no hire of employees and confidentiality, which are similar to those applicable to PRSUs and RSUs. In addition, profits interest participation rights must satisfy the Minimum Value Condition.  PRPUs, like outstanding PRSUs, will be subject to the achievement of incremental pre-established performance conditions and financial metrics and will only result in value to the recipient to the extent the conditions are satisfied.

The number of shares of Class A common stock that a recipient will receive upon the exchange of a PRPU award will be calculated by reference to applicable financial metrics.  The target number of shares of Class A common stock subject to each PRPU is one. Based on the achievement of performance criteria, as determined by the Compensation Committee, the number of shares of Class A common stock that may be received in connection with each PRPU award will range from zero to two times the target number.  Unless applicable performance conditions are satisfied during the three year performance period, and the Minimum Value Condition is satisfied within five years following the grant date, all PRPUs will be forfeited, and the recipients will not be entitled to any such awards.  

In addition, the performance metrics applicable to each PRPU will be evaluated on an annual basis at the end of each fiscal year during the performance period, and, if the Company has achieved a threshold level of performance with respect to the fiscal year, 25% of the target number of PRPUs will no longer be at risk of forfeiture based on the achievement of performance criteria. Profits interest participation rights are allocated income, subject to vesting and settled in cash, in respect of dividends paid on Class A common stock.

The following is a summary of activity relating to profits interest participation rights, including PRPUs, during the six month period ended June 30, 2019:

	Profits Interest Participation Rights		Weighted Average Grant Date Fair Value
Balance, January 1, 2019		-		-
Granted (a)		1,462,702	$	38.65
Balance, June 30, 2019		1,462,702	$	38.65

(a) Table includes the target number of PRPUs assuming the achievement of applicable performance conditions at the target level.

Compensation expense recognized for profits interest participation rights, including PRPUs, is determined by multiplying the number of shares of Class A common stock underlying such awards that, based on the Company’s estimate, are considered probable of vesting, by the grant date fair value.  As of June 30, 2019, the total estimated unrecognized compensation expense was $20,652, and the Company expects to amortize such expense over a weighted-average period of approximately 1.3 years subsequent to June 30, 2019.

LFI and Other Similar Deferred Compensation Arrangements

Commencing in February 2011, the Company granted LFI to eligible employees. In connection with LFI and other similar deferred compensation arrangements, which generally require future service as a condition for vesting, the Company recorded a prepaid compensation asset and a corresponding compensation liability on the grant date based upon the fair value of the award. The prepaid asset is amortized on a straight-line basis over the applicable vesting periods or requisite service periods (which are generally similar to the comparable periods for RSUs), and is charged to “compensation and benefits” expense within the Company’s condensed consolidated statement of operations. LFI and similar deferred compensation arrangements that do not require future service are expensed immediately. The related compensation liability is accounted for at fair value as a derivative liability, which contemplates the impact of estimated forfeitures, and is adjusted for changes in fair value primarily related to changes in value of the underlying investments.

The following is a summary of activity relating to LFI and other similar deferred compensation arrangements during the six month period ended June 30, 2019:

	Prepaid Compensation Asset			Compensation Liability
Balance, January 1, 2019	$	76,362		$	188,022
Granted		101,340			101,340
Settled		-			(82,990	)
Forfeited		(646	)		(983	)
Amortization		(59,283	)		-
Change in fair value related to:
Increase in fair value of underlying investments		-			20,354
Adjustment for estimated forfeitures		-			3,198
Other		275			495
Balance, June 30, 2019	$	118,048		$	229,436

The amortization of the prepaid compensation asset will generally be recognized over a weighted average period of approximately 1.0 years subsequent to June 30, 2019.

The following is a summary of the impact of LFI and other similar deferred compensation arrangements on “compensation and benefits” expense within the accompanying condensed consolidated statements of operations for the three month and six month periods ended June 30, 2019 and 2018:

	Three Months Ended					Six Months Ended
	June 30,					June 30,
	2019		2018			2019		2018
Amortization, net of forfeitures	$	44,210	$	36,293		$	62,144	$	52,129
Change in the fair value of underlying investments		6,484		(499	)		20,354		(1,935	)
Total	$	50,694	$	35,794		$	82,498	$	50,194

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Employee Benefit Plans

6 Months Ended

Jun. 30, 2019

Compensation And Retirement Disclosure [Abstract]

Employee Benefit Plans

15. EMPLOYEE BENEFIT PLANS

The Company provides retirement and other post-retirement benefits to certain of its employees through defined benefit pension plans (the “pension plans”). The Company also offers defined contribution plans to its employees. The pension plans generally provide benefits to participants based on average levels of compensation. Expenses related to the Company’s employee benefit plans are included in “compensation and benefits” expense for the service cost component, and “operating expenses—other” for the other components of benefit costs on the condensed consolidated statements of operations.

Employer Contributions to Pension Plans—The Company’s funding policy for its U.S. and non-U.S. pension plans is to fund when required or when applicable upon an agreement with the plans’ trustees. Management also evaluates from time to time whether to make voluntary contributions to the plans.

The following table summarizes the components of net periodic benefit cost (credit) related to the Company’s pension plans for the three month and six month periods ended June 30, 2019 and 2018:

	Three Months Ended June 30,
	2019			2018
Components of Net Periodic Benefit Cost (Credit):
Service cost	$	205		$	223
Interest cost		3,858			3,977
Expected return on plan assets		(6,873	)		(7,583	)
Amortization of:
Prior service cost		27			-
Net actuarial loss (gain)		1,260			1,245
Settlement loss		1,739			-
Net periodic benefit cost (credit)	$	216		$	(2,138	)

	Six Months Ended June 30,
	2019			2018
Components of Net Periodic Benefit Cost (Credit):
Service cost	$	412		$	453
Interest cost		7,760			8,039
Expected return on plan assets		(13,899	)		(15,366	)
Amortization of:
Prior service cost		56			-
Net actuarial loss (gain)		2,541			2,523
Settlement loss		3,522			-
Net periodic benefit cost (credit)	$	392		$	(4,351	)

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Income Taxes

6 Months Ended

Jun. 30, 2019

Income Tax Disclosure [Abstract]

Income Taxes

16. INCOME TAXES

Lazard Ltd, through its subsidiaries, is subject to U.S. federal income taxes on all of its U.S. operating income, as well as on the portion of non-U.S. income attributable to its U.S. subsidiaries. In addition, Lazard Ltd, through its subsidiaries, is subject to state and local taxes on its income apportioned to various state and local jurisdictions. Outside the U.S., Lazard Group operates principally through subsidiary corporations that are subject to local income taxes in foreign jurisdictions. Lazard Group is also subject to Unincorporated Business Tax (“UBT”) attributable to its operations apportioned to New York City.

The Company recorded income tax provisions of $28,172 and $51,359 for the three month and six month periods ended June 30, 2019, respectively, and $51,561 and $75,728 for the three month and six month periods ended June 30, 2018, respectively, representing effective tax rates of 27.7%, 23.2%, 25.8% and 19.6%, respectively. The difference between the U.S. federal statutory rate of 21.0% and the effective tax rates reflected above principally relates to (i) excess net tax benefit for share-based incentive compensation, (ii) foreign source income (loss) not subject to U.S. income taxes (including interest on intercompany financings), (iii) taxes payable to foreign jurisdictions that are not offset against U.S. income taxes, (iv) change in the U.S. federal valuation allowance affecting the provision for income taxes, (v) U.S. state and local taxes, which are incremental to the U.S. federal statutory tax rate, and (vi) impact of U.S. tax reform, including base erosion and anti-abuse tax.

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Net Income Per Share of Class A Common Stock

6 Months Ended

Jun. 30, 2019

Earnings Per Share [Abstract]

Net Income Per Share of Class A Common Stock

17. NET INCOME PER SHARE OF CLASS A COMMON STOCK

The Company issued certain profits interest participation rights, including certain PRPUs, that the Company is required under U.S. GAAP to treat as participating securities and therefore the Company is required to utilize the “two-class” method of computing basic and diluted net income per share.

The Company’s basic and diluted net income per share calculations using the “two-class” method for the three month and six month periods ended June 30, 2019 and using the “treasury stock” method for the three month and six month periods ended June 30, 2018 are presented below:

	Three Months Ended					Six Months Ended
	June 30,					June 30,
	2019			2018		2019			2018
Net income attributable to Lazard Ltd	$	65,777		$	146,963	$	162,819		$	306,655
Add - adjustment for earnings attributable to participating    securities		(1,604	)		-		(1,604	)		-
Net income attributable to Lazard Ltd - basic		64,173			146,963		161,215			306,655
Add - adjustment for earnings attributable to participating    securities		5			-		5			-
Net income attributable to Lazard Ltd - diluted	$	64,178		$	146,963	$	161,220		$	306,655
Weighted average number of shares of Class A common    stock outstanding		110,076,582			120,049,627		110,847,112			119,872,688
Add - adjustment for shares of Class A common stock    issuable on a non-contingent basis		1,904,622			256,630		1,115,617			245,494
Weighted average number of shares of Class A common    stock outstanding - basic		111,981,204			120,306,257		111,962,729			120,118,182
Add - dilutive effect, as applicable, of:
Weighted average number of incremental shares of Class A    common stock issuable from share-based    incentive compensation		4,194,145			9,942,797		6,534,988			11,077,543
Weighted average number of shares of Class A common stock    outstanding - diluted		116,175,349			130,249,054		118,497,717			131,195,725
Net income attributable to Lazard Ltd per share of Class    A common stock:
Basic	$	0.57		$	1.22	$	1.44		$	2.55
Diluted	$	0.55		$	1.13	$	1.36		$	2.34

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Related Parties

6 Months Ended

Jun. 30, 2019

Related Party Transactions [Abstract]

Related Parties

18. RELATED PARTIES

Sponsored Funds

The Company serves as an investment advisor for certain affiliated investment companies and fund entities and receives management fees and, for the alternative investment funds, performance-based incentive fees for providing such services. Investment advisory fees relating to such services were $153,198 and $297,368 for the three month and six month periods ended June 30, 2019, respectively, and $170,680 and $351,990 for the three month and six month periods ended June 30, 2018, respectively, and are included in “asset management fees” on the condensed consolidated statements of operations. Of such amounts, $56,696 and $59,304 remained as receivables at June 30, 2019 and December 31, 2018, respectively, and are included in “fees receivable” on the condensed consolidated statements of financial condition.

Tax Receivable Agreement

The Second Amended and Restated Tax Receivable Agreement, dated as of October 26, 2015 (the “Amended and Restated Tax Receivable Agreement”), between Lazard and LTBP Trust, a Delaware statutory trust (the “Trust”), provides for the payment by our subsidiaries to the Trust of (i) approximately 45% of the amount of cash savings, if any, in U.S. federal, state and local income tax or franchise tax that we actually realize as a result of certain increases in tax basis and of certain other tax benefits related to the Amended and Restated Tax Receivable Agreement, and (ii) an amount that we currently expect will approximate 85% of the cash tax savings that may arise from tax benefits attributable to payments under the Amended and Restated Tax Receivable Agreement. Our subsidiaries expect to benefit from the balance of cash savings, if any, in income tax that our subsidiaries realize. Any amount paid by our subsidiaries to the Trust will generally be distributed to the owners of the Trust, who include certain of our executive officers, in proportion to their beneficial interests in the Trust.

For purposes of the Amended and Restated Tax Receivable Agreement, cash savings in income and franchise tax will be computed by comparing our subsidiaries’ actual income and franchise tax liability to the amount of such taxes that our subsidiaries would have been required to pay had there been no increase in the tax basis of certain tangible and intangible assets of Lazard Group attributable to our subsidiaries’ interest in Lazard Group and had our subsidiaries not entered into the Amended and Restated Tax Receivable Agreement.  The term of the Amended and Restated Tax Receivable Agreement will continue until approximately 2033 or, if earlier, until all relevant tax benefits have been utilized or expired.

The amount of the Amended and Restated Tax Receivable Agreement liability is an undiscounted amount based upon currently enacted tax laws, the current structure of the Company and various assumptions regarding potential future operating profitability. The assumptions reflected in the estimate involve significant judgment. For example, if our structure were to change or our annual taxable income were to increase, we could be required to accelerate payments under the Amended and Restated Tax Receivable Agreement. As such, the actual amount and timing of payments under the Amended and Restated Tax Receivable Agreement could differ materially from our estimates. Any changes in the amount of the estimated liability would be recorded as a non-compensation expense in the condensed consolidated statement of operations. Adjustments, if necessary, to the related deferred tax assets would be recorded through the “provision (benefit) for income taxes”.

The cumulative liability relating to our obligations under the Amended and Restated Tax Receivable Agreement as of June 30, 2019 and December 31, 2018 was $246,953 and $270,640, respectively, and is recorded in “tax receivable agreement obligation” on the condensed consolidated statements of financial condition. The balance at June 30, 2019 reflects a payment made under the Amended and Restated Tax Receivable Agreement in the six months ended June 30, 2019 of $23,687.

Other

During the six month period ended June 30, 2019, the Company recognized approximately $3,000 of investment banking and other advisory fees pertaining to financial advisory services provided to a company of which a member of the Company’s Board of Directors served as Chairman and CEO. The engagement terms were negotiated in the ordinary course of business on an arms-length basis.

See Note 13 for information regarding related party transactions pertaining to shares repurchased from certain of our executive officers.

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Regulatory Authorities

6 Months Ended

Jun. 30, 2019

Regulatory Capital Requirements [Abstract]

Regulatory Authorities

19. REGULATORY AUTHORITIES

LFNY is a U.S. registered broker-dealer and is subject to the net capital requirements of Rule 15c3-1 under the Exchange Act. Under the basic method permitted by this rule, the minimum required net capital, as defined, is a specified fixed percentage (6 ²/₃%) of total aggregate indebtedness recorded in LFNY’s Financial and Operational Combined Uniform Single (“FOCUS”) report filed with the Financial Industry Regulatory Authority (“FINRA”), or $100, whichever is greater. In addition, the ratio of aggregate indebtedness (as defined) to net capital may not exceed 15:1. At June 30, 2019, LFNY’s regulatory net capital was $90,760, which exceeded the minimum requirement by $87,343. LFNY’s aggregate indebtedness to net capital ratio was 0.56:1 as of June 30, 2019.

Certain U.K. subsidiaries of the Company, including LCL, Lazard Fund Managers Limited and Lazard Asset Management Limited (collectively, the “U.K. Subsidiaries”) are regulated by the Financial Conduct Authority. At June 30, 2019, the aggregate regulatory net capital of the U.K. Subsidiaries was $167,610, which exceeded the minimum requirement by $151,085.

CFLF, under which asset management and commercial banking activities are carried out in France, is subject to regulation by the Autorité de Contrôle Prudentiel et de Résolution (“ACPR”) for its banking activities conducted through its subsidiary, LFB. LFB, as a registered bank, is engaged primarily in commercial and private banking services for clients and funds managed by LFG (asset management) and other clients, and asset-liability management. The investment services activities of the Paris group, exercised through LFB and other subsidiaries of CFLF, primarily LFG, also are subject to regulation and supervision by the Autorité des Marchés Financiers. At June 30, 2019, the consolidated regulatory net capital of CFLF was $168,669, which exceeded the minimum requirement set for regulatory capital levels by $111,947. In addition, pursuant to the consolidated supervision rules in the European Union, LFB, in particular, as a French credit institution, is required to be supervised by a regulatory body, either in the U.S. or in the European Union. During the third quarter of 2013, the Company and the ACPR agreed on terms for the consolidated supervision of LFB and certain other non-Financial Advisory European subsidiaries of the Company (referred to herein, on a combined basis, as the “combined European regulated group”) under such rules. Under this supervision, the combined European regulated group is required to comply with minimum requirements for regulatory net capital to be reported on a quarterly basis and satisfy periodic financial and other reporting obligations. At March 31, 2019, the regulatory net capital of the combined European regulated group was $157,090, which exceeded the minimum requirement set for regulatory capital levels by $53,516. Additionally, the combined European regulated group, together with our European Financial Advisory entities, is required to perform an annual risk assessment and provide certain other information on a periodic basis, including financial reports and information relating to financial performance, balance sheet data and capital structure.

Certain other U.S. and non-U.S. subsidiaries are subject to various capital adequacy requirements promulgated by various regulatory and exchange authorities in the countries in which they operate. At June 30, 2019, for those subsidiaries with regulatory capital requirements, their aggregate net capital was $163,269, which exceeded the minimum required capital by $135,064.

At June 30, 2019, each of these subsidiaries individually was in compliance with its regulatory capital requirements.

Any new or expanded rules and regulations that may be adopted in countries in which we operate (including regulations that have not yet been proposed) could affect us in other ways.

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Segment Information

6 Months Ended

Jun. 30, 2019

Segment Reporting [Abstract]

Segment Information

20. SEGMENT INFORMATION

The Company’s reportable segments offer different products and services and are managed separately as different levels and types of expertise are required to effectively manage the segments’ transactions. Each segment is reviewed to determine the allocation of resources and to assess its performance. The Company’s principal operating activities are included in its Financial Advisory and Asset Management business segments as described in Note 1. In addition, as described in Note 1, the Company records selected other activities in its Corporate segment.

The Company’s segment information for the three month and six month periods ended June 30, 2019 and 2018 is prepared using the following methodology:

• Revenue and expenses directly associated with each segment are included in determining operating income.

• Expenses not directly associated with specific segments are allocated based on the most relevant measures applicable, including headcount, square footage and other factors.

• Segment assets are based on those directly associated with each segment, and include an allocation of certain assets relating to various segments, based on the most relevant measures applicable, including headcount, square footage and other factors.

The Company allocates investment gains and losses, interest income and interest expense among the various segments based on the segment in which the underlying asset or liability is reported.

Each segment’s operating expenses include (i) compensation and benefits expenses incurred directly in support of the businesses and (ii) other operating expenses, which include directly incurred expenses for occupancy and equipment, marketing and business development, technology and information services, professional services, fund administration and outsourced services and indirect support costs (including compensation and other operating expenses related thereto) for administrative services. Such administrative services include, but are not limited to, accounting, tax, human resources, legal, facilities management and senior management activities.

Management evaluates segment results based on net revenue and operating income (loss) and believes that the following information provides a reasonable representation of each segment’s contribution with respect to net revenue, operating income (loss) and total assets:

		Three Months Ended						Six Months Ended
		June 30,						June 30,
		2019			2018			2019			2018
Financial Advisory	Net Revenue	$	329,612		$	422,089		$	667,982		$	831,210
	Operating Expenses		276,238			318,177			556,499			642,873
	Operating Income	$	53,374		$	103,912		$	111,483		$	188,337
Asset Management	Net Revenue	$	315,591		$	352,588		$	617,424		$	706,871
	Operating Expenses		219,021			229,561			426,369			459,230
	Operating Income	$	96,570		$	123,027		$	191,055		$	247,641
Corporate	Net Revenue	$	(14,513	)	$	(16,739	)	$	(11,042	)	$	(25,445	)
	Operating Expenses		33,746			10,260			70,148			24,765
	Operating Loss	$	(48,259	)	$	(26,999	)	$	(81,190	)	$	(50,210	)
Total	Net Revenue	$	630,690		$	757,938		$	1,274,364		$	1,512,636
	Operating Expenses		529,005			557,998			1,053,016			1,126,868
	Operating Income	$	101,685		$	199,940		$	221,348		$	385,768

	As Of
	June 30, 2019		December 31, 2018
Total Assets
Financial Advisory	$	981,571	$	859,306
Asset Management		702,530		728,220
Corporate		3,823,372		3,409,715
Total	$	5,507,473	$	4,997,241

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Consolidated VIEs

6 Months Ended

Jun. 30, 2019

Variable Interest Entity Consolidated Carrying Amount Assets And Liabilities [Abstract]

Consolidated VIEs

21. CONSOLIDATED VIEs

The Company’s consolidated VIEs as of June 30, 2019 include certain funds that were recently established for the benefit of employees participating in the Company’s existing LFI deferred compensation arrangement.  Lazard invests in these funds and is the investment manager and is therefore deemed to have both the power to direct the most significant activities of the funds and the right to receive benefits (or the obligation to absorb losses) that could potentially be significant to these funds.  The Company’s consolidated VIE assets and liabilities as reflected in the condensed consolidated statements of financial condition consist of the following at June 30, 2019:

ASSETS
Cash and cash equivalents	$	4,543
Customers and other receivables		353
Investments (a)		89,762
Other assets		572
Total Assets	$	95,230

LIABILITIES
Deposits and other customer payables	$	1,033
Other liabilities		286
Total Liabilities	$	1,319

(a) Includes $81,999 of LFI held by Lazard Group which is eliminated in the condensed consolidated statements of financial condition.

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Organization and Basis of Presentation (Policies)

6 Months Ended

Jun. 30, 2019

Organization Consolidation And Presentation Of Financial Statements [Abstract]

Organization

Organization

Lazard Ltd, a Bermuda holding company, and its subsidiaries (collectively referred to as “Lazard Ltd”, “Lazard”, “we” or the “Company”), including Lazard Ltd’s indirect investment in Lazard Group LLC, a Delaware limited liability company (collectively referred to, together with its subsidiaries, as “Lazard Group”), is one of the world’s preeminent financial advisory and asset management firms and has long specialized in crafting solutions to the complex financial and strategic challenges of our clients. We serve a diverse set of clients around the world, including corporations, governments, institutions, partnerships and individuals.

Lazard Ltd indirectly held 100% of all outstanding Lazard Group common membership interests as of June 30, 2019 and December 31, 2018. Lazard Ltd, through its control of the managing members of Lazard Group, controls Lazard Group, which is governed by an Amended and Restated Operating Agreement dated as of February 4, 2019 (the “Operating Agreement”).

Lazard Ltd’s primary operating asset is its indirect ownership of the common membership interests of, and managing member interests in, Lazard Group, whose principal operating activities are included in two business segments:

• Financial Advisory, which offers corporate, partnership, institutional, government, sovereign and individual clients across the globe a wide array of financial advisory services regarding mergers and acquisitions (“M&A”), capital advisory, restructurings, shareholder advisory, sovereign advisory, capital raising and other strategic advisory, and

• Asset Management, which offers a broad range of global investment solutions and investment management services in equity and fixed income strategies, asset allocation strategies, alternative investments and private equity funds to corporations, public funds, sovereign entities, endowments and foundations, labor funds, financial intermediaries and private clients.

In addition, we record selected other activities in our Corporate segment, including management of cash, investments, deferred tax assets, outstanding indebtedness, certain contingent obligations, and assets and liabilities associated with Lazard Group’s Paris-based subsidiary Lazard Frères Banque SA (“LFB”).

Basis of Presentation

Basis of Presentation

The accompanying condensed consolidated financial statements of Lazard Ltd have been prepared pursuant to the rules and regulations of the United States Securities and Exchange Commission (the “SEC”) regarding interim financial reporting. Accordingly, they do not include all of the information and notes required by accounting principles generally accepted in the United States of America (“U.S. GAAP”) for complete financial statements and should be read in conjunction with the audited consolidated financial statements and notes thereto included in Lazard Ltd’s Annual Report on Form 10-K for the year ended December 31, 2018. The accompanying December 31, 2018 unaudited condensed consolidated statement of financial condition data was derived from audited consolidated financial statements, but does not include all disclosures required by U.S. GAAP for annual financial statement purposes. The accompanying condensed consolidated financial statements reflect all adjustments which are, in the opinion of management, necessary for a fair presentation of the financial position, results of operations and cash flows for the interim periods presented.

Preparing financial statements requires management to make estimates and assumptions that affect the amounts that are reported in the financial statements and the accompanying disclosures. For example, discretionary compensation and benefits expense for interim periods is accrued based on the year-to-date amount of revenue earned, and an assumed annual ratio of compensation and benefits expense to revenue, with the applicable amounts adjusted for certain items. Although these estimates are based on management’s knowledge of current events and actions that Lazard may undertake in the future, actual results may differ materially from the estimates.

The consolidated results of operations for the three month and six month periods ended June 30, 2019 are not indicative of the results to be expected for any future interim or annual period.

The condensed consolidated financial statements include Lazard Ltd, Lazard Group and Lazard Group’s principal operating subsidiaries: Lazard Frères & Co. LLC (“LFNY”), a New York limited liability company, along with its subsidiaries, including Lazard Asset Management LLC and its subsidiaries (collectively referred to as “LAM”); the French limited liability companies Compagnie Financière Lazard Frères SAS (“CFLF”) along with its subsidiaries, LFB and Lazard Frères Gestion SAS (“LFG”), and Maison Lazard SAS and its subsidiaries; and Lazard & Co., Limited (“LCL”), through Lazard & Co., Holdings Limited (“LCH”), an English private limited company, together with their jointly owned affiliates and subsidiaries.

The Company’s policy is to consolidate entities in which it has a controlling financial interest. The Company consolidates:

• Voting interest entities (“VOEs”) where the Company holds a majority of the voting interest in such VOEs, and

• Variable interest entities (“VIEs”) where the Company is the primary beneficiary having the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance and the obligation to absorb losses of, or receive benefits from, the VIE that could be potentially significant to the VIE (see Note 21).

When the Company does not have a controlling interest in an entity, but exerts significant influence over such entity’s operating and financial decisions, the Company either (i) applies the equity method of accounting in which it records a proportionate share of the entity’s net earnings, or (ii) elects the option to measure at fair value. Intercompany transactions and balances have been eliminated.

Certain prior period amounts have been reclassified to conform to the current period presentation.

Recent Accounting Developments

Leases—In February 2016, the Financial Accounting Standards Board (the “FASB”) issued updated guidance for leases. The guidance requires a lessee to (i) recognize a right-of-use asset and a lease liability that is initially measured at the present value of the lease payments, in the condensed consolidated statement of financial condition, (ii) recognize a single lease cost, calculated so that the cost of the lease is allocated over the lease term on a straight-line basis and (iii) classify operating lease related cash payments within operating activities and finance lease related principal cash payments within financing activities (with interest included in interest paid) in the condensed consolidated statement of cash flows.

The Company adopted the new guidance on January 1, 2019 using the optional transition method, which allows such guidance to be applied initially at the adoption date with a cumulative-effect adjustment and without restating comparative periods. Lazard elected the package of practical expedients, which allows the carry-forward of the prior conclusions on lease definition, classification and initial direct costs related to the existing leases as of the adoption date.

Substantially all of the Company’s existing lease arrangements are operating leases. The adoption of the new guidance on January 1, 2019 resulted in a recognition of $502,000 of operating lease right-of-use assets (“ROU assets”) and $581,000 of operating lease liabilities in the Company’s condensed consolidated statements of financial condition.  The operating lease liabilities at January 1, 2019 reflect any remaining lease payments discounted using an incremental borrowing rate (on a collateralized basis) based on the remaining lease term (the “Discount”), as an implicit rate was not readily determinable for any of the Company’s existing operating leases.  The operating lease ROU assets are lower than the operating lease liabilities primarily because lease incentives reduce the ROU assets (see Note 9).

Improvements to Nonemployee Share-Based Payment Accounting—In June 2018, the FASB issued updated guidance to simplify the accounting for nonemployee share-based payment transactions. The new guidance generally requires equity-classified nonemployee share-based payment awards to be measured at the grant date, which is the date at which a grantor and grantee reach a mutual understanding of the key terms and conditions of a share-based payment award.  This update generally aligns the accounting for equity-classified share-based payment awards to nonemployees with the measurement date required for employees.  The Company adopted the new guidance on January 1, 2019 and its application did not have a material impact on the Company’s financial statements.

Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income—In February 2018, the FASB issued updated guidance on the tax effects of items in “accumulated other comprehensive income (loss), net of tax” (“AOCI”). Specifically, the new guidance will permit, but not require, a reclassification from AOCI to retained earnings for stranded tax effects resulting from the newly enacted federal corporate income tax rate under the Tax Cuts and Jobs Act of 2017. The amount of the reclassification would be the difference between the historical corporate income tax rate and the newly enacted 21% corporate income tax rate. The Company adopted the new guidance on January 1, 2019 without reclassifying any amounts from AOCI to retained earnings.  The application of the guidance did not have a material impact on the Company’s financial statements.

Financial Instruments—Credit Losses: Measurement of Credit Losses on Financial Instruments—In June 2016, the FASB issued new guidance regarding the measurement of credit losses on financial instruments. The new guidance replaces the incurred loss impairment methodology in the current guidance with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to determine credit loss estimates. The new guidance is effective for annual and interim periods beginning after December 15, 2019 with early adoption permitted for fiscal years beginning after December 15, 2018.  The new guidance is required to be applied using a modified retrospective approach. The Company is currently evaluating the new guidance.

Intangibles—Goodwill and Other: Simplifying the Test for Goodwill Impairment—In January 2017, the FASB issued updated guidance which eliminated Step 2 from the goodwill impairment test. Step 2 is the process of measuring a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. The new guidance requires entities to measure a goodwill impairment loss as the amount by which a reporting unit’s carrying value exceeds its fair value, limited to the carrying amount of goodwill. The FASB also eliminated the requirements for entities that have reporting units with zero or negative carrying amounts to perform a qualitative assessment for the goodwill impairment test. Instead, those entities would be required to disclose the amount of goodwill allocated to each reporting unit with a zero or negative carrying amount. The new guidance is effective for interim or annual goodwill impairment tests performed in fiscal years beginning after December 15, 2019, with early adoption permitted. The Company is currently evaluating the new guidance.

Intangibles—Internal-Use Software: Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract—In August 2018, the FASB issued updated guidance on the accounting for implementation costs incurred in a cloud computing arrangement. The new guidance requires the capitalization of the implementation costs incurred in a cloud computing arrangement to be aligned with the requirements for capitalizing costs incurred to develop or obtain internal-use software. The new guidance is effective for annual and interim reporting periods beginning after December 15, 2019, with early adoption permitted. Upon adoption, the Company may elect to apply the new guidance on either a prospective or retrospective basis. The Company is currently evaluating the new guidance.

Related Party Guidance for Variable Interest Entities—In October 2018, the FASB issued updated guidance that requires consideration of indirect interest held through related parties under common control for determining whether fees paid to decision makers and service providers are variable interests. The new guidance is effective for fiscal years and interim periods beginning after December 15, 2019, with early adoption permitted. The amendments are required to be applied retrospectively with a cumulative-effect adjustment. The Company is currently evaluating the new guidance.

Fair Value Measurement: Changes to the Disclosure Requirements for Fair Value Measurement—In August 2018, the FASB issued updated guidance which modifies the disclosure requirements on fair value measurement. The updated guidance eliminates or modifies various required disclosures under the current guidance and includes additional requirements. The new guidance is effective for annual and interim reporting periods beginning after December 15, 2019, with early adoption permitted.  With certain exceptions, the guidance is required to be applied retrospectively. The Company is currently evaluating the new guidance.

Compensation–Retirement Benefits: Changes to the Disclosure Requirements for Defined Benefit Plans—In August 2018, the FASB issued updated guidance which modifies the disclosure requirements regarding defined benefit plans and other postretirement plans. The updated guidance eliminates or clarifies certain currently required disclosures and includes additional requirements. The new guidance is effective for annual and interim reporting periods beginning after December 15, 2020, with early adoption permitted. A retrospective application is required. The Company is currently evaluating the new guidance.

Revenue Recognition Policy

Investment Banking and Other Advisory Fees—Fees for Financial Advisory services are recorded when: (i) a contract with a client has been identified, (ii) the performance obligations in the contract have been identified, (iii) the fee or other transaction price has been determined, (iv) the fee or other transaction price has been allocated to each performance obligation in the contract, and (v) the Company has satisfied the applicable performance obligation. The expenses that are directly related to such transactions are recorded as incurred and presented within operating expenses when the Company is primarily responsible for fulfilling the promise of the arrangement. Revenues associated with the reimbursement of such expenses are recorded when the Company is contractually entitled to reimbursement and presented within investment banking and other advisory fees.

Asset Management Fees—Fees for Asset Management services are primarily comprised of management fees and incentive fees. Management fees are derived from fees for investment management and other services provided to clients. Revenue is recorded in accordance with the same five criteria as Financial Advisory fees, which generally results in management fees being recorded on a daily, monthly or quarterly basis, primarily based on a percentage of client assets managed.  Fees vary with the type of assets managed, with higher fees earned on equity assets, alternative investment (such as hedge fund) and private equity funds, and lower fees earned on fixed income and money market products.  Expenses that are directly related to the sale or distribution of fund interests are recorded as incurred and presented within operating expenses when the Company is primarily responsible for fulfilling the promise of the arrangement.  Revenues associated with the reimbursement of such expenses are recorded when the Company is contractually entitled to reimbursement and presented within asset management fees.

In addition, the Company earns performance-based incentive fees on various investment products, including traditional products and alternative investment funds such as hedge funds and private equity funds.  

For hedge funds, incentive fees are calculated based on a specific percentage of a fund’s net appreciation, in some cases in excess of established benchmarks or thresholds.  The Company records incentive fees on traditional products and hedge funds when a significant reversal in the amount of the cumulative revenue to be recognized is not probable, which is typically at the end of the relevant performance measurement period. The incentive fee measurement period is generally an annual period (unless an account is terminated during the year).  The incentive fees received at the end of the measurement period are not subject to reversal or payback.  Incentive fees on hedge funds generally are subject to loss carryforward provisions in which losses incurred by the hedge funds in any year are applied against certain gains realized by the hedge funds in future periods before any incentive fees can be earned.

For private equity funds, incentive fees may be earned in the form of a “carried interest” if profits arising from realized investments exceed a specified threshold. Typically, such carried interest is ultimately calculated on a whole-fund basis and, therefore, clawback of carried interests during the life of the fund can occur. As a result, the Company records incentive fees earned on our private equity funds when a significant reversal in the amount of the cumulative revenue to be recognized is not probable, which is typically at the end of the relevant performance period.

Receivables relating to asset management and incentive fees are reported in “fees receivable” on the consolidated statements of financial condition.

Fair Value Measurement Policy

Fair Value Hierarchy of Investments and Certain Other Assets and Liabilities—Lazard categorizes its investments and certain other assets and liabilities recorded at fair value into a three-level fair value hierarchy as follows:

Level 1. Assets and liabilities whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market that Lazard has the ability to access.

Level 2. Assets and liabilities whose values are based on (i) quoted prices for similar assets or liabilities in an active market, or quoted prices for identical or similar assets or liabilities in non-active markets, or (ii) inputs other than quoted prices that are directly observable or derived principally from, or corroborated by, market data.

Level 3. Assets and liabilities whose values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. These inputs reflect our own assumptions about the assumptions a market participant would use in pricing the asset or liability. Items included in Level 3 include securities or other financial assets whose trading volume and level of activity have significantly decreased when compared with normal market activity and there is no longer sufficient frequency or volume to provide pricing information on an ongoing basis.

The fair value of debt is classified as Level 1 when the fair values are based on unadjusted quoted prices in active markets.

The fair value of equities is classified as Level 1 or Level 3 as follows: marketable equity securities are classified as Level 1 and are valued based on the last trade price on the primary exchange for that security as provided by external pricing services; equity securities in private companies are generally classified as Level 3.

The fair value of investments in alternative investment funds, debt funds and equity funds is classified as Level 1 when the fair values are primarily based on the publicly reported closing price for the fund.

The fair value of investments in private equity funds is classified as Level 3 for certain investments that are valued based on the potential transaction value as of June 30, 2019.

The fair value of securities sold, not yet purchased, is classified as Level 1 when the fair values are based on unadjusted quoted prices in active markets.

The fair value of the contingent consideration liability is classified as Level 3 and the fair value of the liability is remeasured at each reporting period. The inputs used to derive the fair value of the contingent consideration include the application of probabilities when assessing certain performance thresholds for the relevant periods. Any change in the fair value is recognized in “amortization and other acquisition-related (benefits) costs” in the condensed consolidated statement of operations. Our business acquisitions may involve the potential payment of contingent consideration upon the achievement of certain performance thresholds. The contingent consideration liability is initially recorded at fair value of the contingent payments on the acquisition date and is included in “other liabilities” on the condensed consolidated statements of financial condition. See Note 12.

The fair value of derivatives entered into by the Company is classified as Level 2 and is based on the values of the related underlying assets, indices or reference rates as follows: the fair value of forward foreign currency exchange rate contracts is a function of the spot rate and the interest rate differential of the two currencies from the trade date to settlement date; the fair value of total return swaps is based on the change in fair value of the related underlying equity security, financial instrument or index and a specified notional holding; the fair value of interest rate swaps is based on the interest rate yield curve; and the fair value of derivative liabilities related to LFI and other similar deferred compensation arrangements is based on the value of the underlying investments, adjusted for forfeitures. See Note 7.

Investments Measured at Net Asset Value (“NAV”)—As a practical expedient, the Company uses NAV or its equivalent to measure the fair value of certain investments. NAV is primarily determined based on information provided by external fund administrators. The Company’s investments valued at NAV as a practical expedient in (i) alternative investment funds, debt funds and equity funds are redeemable in the near term, and (ii) private equity funds are not redeemable in the near term as a result of redemption restrictions.

Derivative Instruments

The Company enters into forward foreign currency exchange rate contracts, interest rate swaps, interest rate futures, total return swap contracts on various equity and debt indices and other derivative contracts to economically hedge exposures to fluctuations in currency exchange rates, interest rates and equity and debt prices. The Company reports its derivative instruments separately as assets and liabilities unless a legal right of set-off exists under a master netting agreement enforceable by law. The Company’s derivative instruments are recorded at their fair value, and are included in “other assets” and “other liabilities” on the condensed consolidated statements of financial condition. Gains and losses on the Company’s derivative instruments are generally included in “interest income” and “interest expense”, respectively, or “revenue-other”, depending on the nature of the underlying item, in the condensed consolidated statements of operations.

In addition to the derivative instruments described above, the Company records derivative liabilities relating to its obligations pertaining to LFI and other similar deferred compensation arrangements, the fair value of which is based on the value of the underlying investments, adjusted for estimated forfeitures, and is included in “accrued compensation and benefits” in the condensed consolidated statements of financial condition. Changes in the fair value of the derivative liabilities are included in “compensation and benefits” in the condensed consolidated statements of operations, the impact of which equally offsets the changes in the fair value of investments which are currently expected to be delivered upon settlement of LFI and other similar deferred compensation arrangements, which are reported in “revenue-other” in the condensed consolidated statements of operations.

Share-Based Incentive Plan Awards

Share-Based Incentive Plan Awards

A description of Lazard Ltd’s 2018 Plan, 2008 Plan and 2005 Equity Incentive Plan (the “2005 Plan”) and activity with respect thereto during the three month and six month periods ended June 30, 2019 and 2018 is presented below.

Shares Available Under the 2018 Plan, 2008 Plan and 2005 Plan

The 2018 Plan became effective on April 24, 2018 and replaced the 2008 Plan, which was terminated on April 24, 2018. The 2018 Plan authorizes the issuance of up to 30,000,000 shares of Class A common stock pursuant to the grant or exercise of stock options, stock appreciation rights, restricted stock units (“RSUs”), performance-based restricted stock units (“PRSUs”), profits interest participation rights and other share-based awards.

The 2008 Plan authorized the issuance of shares of Class A common stock pursuant to the grant or exercise of stock options, stock appreciation rights, RSUs, PRSUs and other share-based awards. Under the 2008 Plan, the maximum number of shares available was based on a formula that limited the aggregate number of shares that could, at any time, be subject to awards that were considered “outstanding” under the 2008 Plan to 30% of the then-outstanding shares of Class A common stock. The 2008 Plan was terminated on April 24, 2018, and no additional awards have been or will be granted under the 2008 Plan after its termination, although outstanding awards granted under the 2008 Plan before its termination continue to be subject to its terms.

The 2005 Plan authorized the issuance of up to 25,000,000 shares of Class A common stock pursuant to the grant or exercise of stock options, stock appreciation rights, RSUs and other share-based awards. The 2005 Plan expired in the second quarter of 2015, although outstanding deferred stock unit (“DSU”) awards granted under the 2005 Plan before its expiration continue to be subject to its terms.

Employer Contributions to Pension Plans

Employer Contributions to Pension Plans—The Company’s funding policy for its U.S. and non-U.S. pension plans is to fund when required or when applicable upon an agreement with the plans’ trustees. Management also evaluates from time to time whether to make voluntary contributions to the plans.

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Revenue Recognition (Tables)

6 Months Ended

Jun. 30, 2019

Revenue Recognition [Abstract]

Revenue Based on Business Segment Results

The Company disaggregates revenue based on its business segment results and believes that the following information provides a reasonable representation of how performance obligations relate to the nature, amount, timing and uncertainty of revenue and cash flows:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2019		2018		2019		2018
Net Revenue:
Financial Advisory (a)	$	329,612	$	422,089	$	667,982	$	831,210
Asset Management:
Management Fees and Other (b)	$	310,316	$	340,160	$	611,569	$	688,844
Incentive Fees (c)		5,275		12,428		5,855		18,027
Total Asset Management	$	315,591	$	352,588	$	617,424	$	706,871

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Receivables (Tables)

6 Months Ended

Jun. 30, 2019

Receivables [Abstract]

Schedule of Activity in Allowance for Doubtful Accounts

Activity in the allowance for doubtful accounts for the three month and six month periods ended June 30, 2019 and 2018 was as follows:

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2019			2018			2019			2018
Beginning Balance	$	43,258		$	38,557		$	40,164		$	23,746
Bad debt expense, net of recoveries		(9,380	)		666			(5,551	)		16,618
Charge-offs, foreign currency translation and other    adjustments		(343	)		(4,267	)		(1,078	)		(5,408	)
Ending Balance	$	33,535		$	34,956		$	33,535		$	34,956

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Investments (Tables)

6 Months Ended

Jun. 30, 2019

Investments Schedule [Abstract]

Company's Investments and Securities Sold, Not Yet Purchased

The Company’s investments and securities sold, not yet purchased, consist of the following at June 30, 2019 and December 31, 2018:

	June 30,		December 31,
	2019		2018
Interest-bearing deposits	$	511	$	510
Debt		124,838		202,874
Equities		37,858		32,261
Funds:
Alternative investments (a)		42,000		17,752
Debt (a)		104,756		90,320
Equity (a)		223,593		175,088
Private equity		41,868		56,343
		412,217		339,503
Total investments		575,424		575,148
Less:
Interest-bearing deposits		511		510
Investments, at fair value	$	574,913	$	574,638
Securities sold, not yet purchased, at fair value    (included in “other liabilities”)	$	2,261	$	3,929

(a) Interests in alternative investment funds, debt funds and equity funds include investments with fair values of $9,665, $75,364 and $172,711, respectively, at June 30, 2019 and $9,741, $60,081 and $132,038, respectively, at December 31, 2018, held in order to satisfy the Company’s liability upon vesting of previously granted Lazard Fund Interests (“LFI”) and other similar deferred compensation arrangements. LFI represent grants by the Company to eligible employees of actual or notional interests in a number of Lazard-managed funds, subject to service-based vesting conditions (see Notes 7 and 14).

Schedule of Equity Securities and Trading Debt Securities Net Unrealized Investment Gains and Losses

During the three month and six month periods ended June 30, 2019 and 2018, the Company reported in “revenue-other” on its condensed consolidated statements of operations net unrealized investment gains and losses pertaining to “equity securities and trading debt securities” still held as of the reporting date as follows:

	Three Months Ended					Six Months Ended
	June 30,					June 30,
	2019		2018			2019		2018
Net unrealized investment gains (losses)	$	7,229	$	(5,864	)	$	27,152	$	(15,155	)

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Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2019

Fair Value Disclosures [Abstract]

Schedule of Classification of Investments and Certain Other Assets and Liabilities Measured at Fair Value on Recurring Basis and Investments Measured at NAV

The following tables present, as of June 30, 2019 and December 31, 2018, the classification of (i) investments and certain other assets and liabilities measured at fair value on a recurring basis within the fair value hierarchy and (ii) investments measured at NAV or its equivalent as a practical expedient:

	June 30, 2019
	Level 1		Level 2		Level 3		NAV		Total
Assets:
Investments:
Debt	$	124,838	$	-	$	-	$	-	$	124,838
Equities		36,252		-		1,606		-		37,858
Funds:
Alternative investments		17,196		-		-		24,804		42,000
Debt		104,749		-		-		7		104,756
Equity		223,554		-		-		39		223,593
Private equity		-		-		2,131		39,737		41,868
Derivatives		-		2,180		-		-		2,180
Total	$	506,589	$	2,180	$	3,737	$	64,587	$	577,093
Liabilities:
Securities sold, not yet purchased	$	2,261	$	-	$	-	$	-	$	2,261
Contingent consideration liability		-		-		4,386		-		4,386
Derivatives		-		235,504		-		-		235,504
Total	$	2,261	$	235,504	$	4,386	$	-	$	242,151

	December 31, 2018
	Level 1		Level 2		Level 3		NAV		Total
Assets:
Investments:
Debt	$	202,874	$	-	$	-	$	-	$	202,874
Equities		30,639		-		1,622		-		32,261
Funds:
Alternative investments		16,863		-		-		889		17,752
Debt		90,313		-		-		7		90,320
Equity		175,054		-		-		34		175,088
Private equity		-		-		-		56,343		56,343
Derivatives		-		11,967		-		-		11,967
Total	$	515,743	$	11,967	$	1,622	$	57,273	$	586,605
Liabilities:
Securities sold, not yet purchased	$	3,929	$	-	$	-	$	-	$	3,929
Contingent consideration liability		-		-		10,009		-		10,009
Derivatives		-		188,962		-		-		188,962
Total	$	3,929	$	188,962	$	10,009	$	-	$	202,900

Summary of Changes in Fair Value of Company's Level 3 Assets and Liabilities

The following tables provide a summary of changes in fair value of the Company’s Level 3 assets and liabilities for the three month and six month periods ended June 30, 2019 and 2018:

	Three Months Ended June 30, 2019
	Beginning Balance		Net Unrealized/ Realized Gains/Losses Included In Earnings (a)			Purchases/ Acquisitions/ Transfers (b)		Sales/ Dispositions/ Settlements			Foreign Currency Translation Adjustments		Ending Balance
Assets:
Investments:
Equities	$	1,618	$	(12	)	$	-	$	-		$	-	$	1,606
Private equity funds		-		-			2,131		-			-		2,131
Total Level 3 Assets	$	1,618	$	(12	)	$	2,131	$	-		$	-	$	3,737
Liabilities:
Contingent consideration liability	$	13,048	$	4,611		$	-	$	(13,273	)	$	-	$	4,386
Total Level 3 Liabilities	$	13,048	$	4,611		$	-	$	(13,273	)	$	-	$	4,386

	Six Months Ended June 30, 2019
	Beginning Balance		Net Unrealized/ Realized Gains/Losses Included In Earnings (a)			Purchases/ Acquisitions/ Transfers (b)		Sales/ Dispositions/ Settlements			Foreign Currency Translation Adjustments			Ending Balance
Assets:
Investments:
Equities	$	1,622	$	(14	)	$	-	$	-		$	(2	)	$	1,606
Private equity funds		-		-			2,131		-			-			2,131
Total Level 3 Assets	$	1,622	$	(14	)	$	2,131	$	-		$	(2	)	$	3,737
Liabilities:
Contingent consideration liability	$	10,009	$	7,650		$	-	$	(13,273	)	$	-		$	4,386
Total Level 3 Liabilities	$	10,009	$	7,650		$	-	$	(13,273	)	$	-		$	4,386

	Three Months Ended June 30, 2018
	Beginning Balance		Net Unrealized/ Realized Gains/Losses Included In Earnings (a)			Purchases/ Acquisitions		Sales/ Dispositions/ Settlements		Foreign Currency Translation Adjustments			Ending Balance
Assets:
Investments:
Equities	$	1,599	$	62		$	-	$	-	$	(32	)	$	1,629
Total Level 3 Assets	$	1,599	$	62		$	-	$	-	$	(32	)	$	1,629
Liabilities:
Contingent consideration liability	$	28,974	$	(9,346	)	$	-	$	-	$	-		$	19,628
Total Level 3 Liabilities	$	28,974	$	(9,346	)	$	-	$	-	$	-		$	19,628

	Six Months Ended June 30, 2018
	Beginning Balance		Net Unrealized/ Realized Gains/Losses Included In Earnings (a)			Purchases/ Acquisitions		Sales/ Dispositions/ Settlements		Foreign Currency Translation Adjustments			Ending Balance
Assets:
Investments:
Equities	$	1,592	$	61		$	1	$	-	$	(25	)	$	1,629
Total Level 3 Assets	$	1,592	$	61		$	1	$	-	$	(25	)	$	1,629
Liabilities:
Contingent consideration liability	$	28,941	$	(9,313	)	$	-	$	-	$	-		$	19,628
Total Level 3 Liabilities	$	28,941	$	(9,313	)	$	-	$	-	$	-		$	19,628

(a) Earnings recorded in “other revenue” for investments in equities for the three month and six month periods ended June 30, 2019 and the three month and six month periods ended June 30, 2018 include net unrealized gains (losses) of $(12), $(14), $62 and $61, respectively. Earnings recorded in “amortization and other acquisition-related (benefits) costs” for the contingent consideration liability for the three month and six month periods ended June 30, 2019 and the three month and six month periods ended June 30, 2018 include unrealized (gains) losses of $4,611, $7,650, $(9,346) and $(9,313), respectively.

(b) Certain investments that were valued at NAV as of December 31, 2018 were transferred to Level 3 during the three month and six month periods ended June 30, 2019 as these investments are valued based on a potential transaction value that differs from NAV.

Fair Value of Certain Investments Based on NAV

The following tables present, at June 30, 2019 and December 31, 2018, certain investments that are valued using NAV or its equivalent as a practical expedient in determining fair value:

June 30, 2019

Estimated Liquidation Period of Investments Not Redeemable

Investments Redeemable

Fair Value

Unfunded Commitments

% of Fair Value Not Redeemable

% Next 5 Years

% 5-10 Years

% Thereafter

Redemption Frequency

Redemption Notice Period

Alternative investment funds:

Hedge funds

$

24,183

$

-

NA

NA

NA

NA

(a)

30-60 days

Funds of funds

24

-

NA

NA

NA

NA

(b)

>90 days

Other

597

-

NA

NA

NA

NA

(c)

<30-30 days

Debt funds

7

-

NA

NA

NA

NA

(d)

<30 days

Equity funds

39

-

NA

NA

NA

NA

(e)

<30-90 days

Private equity funds:

Equity growth

39,737

8,264

(f)

100

%

19

%

14

%

67

%

NA

NA

Total

$

64,587

$

8,264

(a) monthly (100%)

(b) quarterly (100%)

(c) daily (6%) and monthly (94%)

(d) daily (100%)

(e) daily (23%), monthly (72%) and annually (5%)

(f) Unfunded commitments to private equity investments consolidated but not owned by Lazard of $13,400 are excluded. Such commitments are required to be funded by capital contributions from noncontrolling interest holders.

December 31, 2018

Estimated Liquidation Period of Investments Not Redeemable

Investments Redeemable

Fair Value

Unfunded Commitments

% of Fair Value Not Redeemable

% Next 5 Years

% 5-10 Years

% Thereafter

Redemption Frequency

Redemption Notice Period

Alternative investment funds:

Hedge funds

$

299

$

-

NA

NA

NA

NA

(a)

30-60 days

Funds of funds

23

-

NA

NA

NA

NA

(b)

>90 days

Other

567

-

NA

NA

NA

NA

(c)

<30-30 days

Debt funds

7

-

NA

NA

NA

NA

(d)

<30 days

Equity funds

34

-

NA

NA

NA

NA

(e)

<30-90 days

Private equity funds:

Equity growth

56,343

8,338

(f)

100

%

14

%

34

%

52

%

NA

NA

Total

$

57,273

$

8,338

(a) monthly (100%)   

(b) quarterly (100%)

(c) daily (6%) and monthly (94%)

(d) daily (100%)

(e) daily (25%), monthly (70%) and annually (5%)

(f) Unfunded commitments to private equity investments consolidated but not owned by Lazard of $14,437 are excluded. Such commitments are required to be funded by capital contributions from noncontrolling interest holders.

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Derivatives (Tables)

6 Months Ended

Jun. 30, 2019

Derivative Instruments And Hedging Activities Disclosure [Abstract]

Fair Values of Derivatives Reported on Condensed Consolidated Statements of Financial Condition

The table below presents the fair value of the Company’s derivative instruments reported within “other assets” and “other liabilities” and the fair value of the Company’s derivative liabilities relating to its obligations pertaining to LFI and other similar deferred compensation arrangements reported within “accrued compensation and benefits” (see Note 13) on the accompanying condensed consolidated statements of financial condition as of June 30, 2019 and December 31, 2018:

	June 30,		December 31,
	2019		2018
Derivative Assets:
Forward foreign currency exchange rate contracts	$	2,180	$	1,543
Total return swaps and other (a)		-		10,424
	$	2,180	$	11,967
Derivative Liabilities:
Forward foreign currency exchange rate contracts	$	1,442	$	939
Total return swaps and other (a)		4,626		1
LFI and other similar deferred compensation arrangements		229,436		188,022
	$	235,504	$	188,962

(a) For total return swaps, amounts represent the netting of gross derivative assets and liabilities of $139 and $4,765 as of June 30, 2019, respectively, and $10,792 and $369 as of December 31, 2018, respectively, for contracts with the same counterparty under legally enforceable master netting agreements. Such amounts are recorded “net” in “other assets”, with receivables for net cash collateral under such contracts of $5,950 as of June 30, 2019.

Net Gains and (Losses) With Respect To Derivative Instruments (Including Derivatives Not Designed As Hedging Instruments)

Net gains (losses) with respect to derivative instruments (predominantly reflected in “revenue-other”) and the Company’s derivative liabilities relating to its obligations pertaining to LFI and other similar deferred compensation arrangements (included in “compensation and benefits” expense) as reflected on the accompanying condensed consolidated statements of operations for the three month and six month periods ended June 30, 2019 and 2018, were as follows:

	Three Months Ended					Six Months Ended
	June 30,					June 30,
	2019			2018		2019			2018
Forward foreign currency exchange rate contracts	$	(3,424	)	$	6,236	$	1,096		$	3,753
LFI and other similar deferred compensation arrangements		(6,484	)		499		(20,354	)		1,935
Total return swaps and other		(1,976	)		790		(9,633	)		2,446
Total	$	(11,884	)	$	7,525	$	(28,891	)	$	8,134

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Property (Tables)

6 Months Ended

Jun. 30, 2019

Property Plant And Equipment [Abstract]

Components of Property

At June 30, 2019 and December 31, 2018, property consisted of the following:

	Estimated Depreciable		June 30,		December 31,
	Life in Years		2019		2018
Buildings		33	$	144,148	$	145,034
Leasehold improvements	3-20			188,736		188,956
Furniture and equipment	3-10			205,607		204,585
Construction in progress				19,084		14,141
Total				557,575		552,716
Less - Accumulated depreciation and amortization				351,119		339,770
Property			$	206,456	$	212,946

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Leases (Tables)

6 Months Ended

Jun. 30, 2019

Leases [Abstract]

Summary of Components of Operating Lease Expense

The following table summarizes the components of operating lease expense reflected on the accompanying condensed consolidated statements of operations for the three month and six month periods ended June 30, 2019:

	Three Months Ended		Six Months Ended
	June 30, 2019		June 30, 2019
Operating lease cost	$	18,910	$	38,900
Variable lease cost		4,802		9,051
Less - sublease income		1,692		3,462
Total	$	22,020	$	44,489

Summary of Supplemental Cash Flow Information And Certain Other Information Related to Operating Leases

The following table summarizes the supplemental cash flow information and certain other information related to operating leases for the six month period ended June 30, 2019:

	Six Months Ended
	June 30, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	39,759
Operating lease right-of-use assets obtained in exchange for operating lease liabilities	$	504,706
Weighted average remaining lease term	12 years
Weighted average discount rate		4.1	%

Summary of Maturities of Operating Lease Liabilities Outstanding

Maturities of the operating lease liabilities outstanding at June 30, 2019 for each of the years in the period ending December 31, 2024 and thereafter are set forth in the table below.

Year Ending December 31,
2019 (July 1 through December 31)	$	39,879
2020		76,856
2021		72,870
2022		56,879
2023		52,228
2024		51,045
Thereafter		360,876
Total lease payments		710,633
Less -  Discount		155,309
Operating lease liabilities	$	555,324

Schedule of Prior Adoption For Future Minimum Rental Payment for Operating Leases

Prior to the adoption of the new lease accounting guidance, the minimum rental commitments under non-cancelable operating leases at December 31, 2018, net of sublease income, were approximately as follows:

Year Ending December 31,
2019	$	86,839
2020		89,445
2021		83,701
2022		70,780
2023		59,973
Thereafter		488,612
Total minimum rental commitments		879,350
Less - sublease proceeds		26,941
Net rental commitments	$	852,409

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Goodwill and Other Intangible Assets (Tables)

6 Months Ended

Jun. 30, 2019

Goodwill And Intangible Assets Disclosure [Abstract]

Components of Goodwill and Other Intangible Assets

The components of goodwill and other intangible assets at June 30, 2019 and December 31, 2018 are presented below:

	June 30,		December 31,
	2019		2018
Goodwill	$	371,536	$	371,561
Other intangible assets (net of accumulated    amortization)		2,900		3,757
	$	374,436	$	375,318

Changes in Carrying Amount of Goodwill

Changes in the carrying amount of goodwill for the six month periods ended June 30, 2019 and 2018 are as follows:

	Six Months Ended
	June 30,
	2019			2018
Balance, January 1	$	371,561		$	385,292
Foreign currency translation adjustments		(25	)		(8,028	)
Balance, June 30	$	371,536		$	377,264

Gross Cost and Accumulated Amortization of Other Intangible Assets

The gross cost and accumulated amortization of other intangible assets as of June 30, 2019 and December 31, 2018, by major intangible asset category, are as follows:

	June 30, 2019						December 31, 2018
	Gross Cost		Accumulated Amortization		Net Carrying Amount		Gross Cost		Accumulated Amortization		Net Carrying Amount
Success/incentive fees	$	35,322	$	33,075	$	2,247	$	35,232	$	32,235	$	2,997
Management fees, customer relationships and    non-compete agreements		34,486		33,833		653		34,474		33,714		760
	$	69,808	$	66,908	$	2,900	$	69,706	$	65,949	$	3,757

Estimated Future Amortization Expense

Estimated future amortization expense is as follows:

Year Ending December 31,	Amortization Expense
2019 (July 1 through December 31)	$	862
2020		1,700
2021		150
2022		150
2023		38
Total amortization expense	$	2,900

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Senior Debt (Tables)

6 Months Ended

Jun. 30, 2019

Debt Disclosure [Abstract]

Senior Debt

Senior debt is comprised of the following as of June 30, 2019 and December 31, 2018:

							Outstanding as of
	Initial			Annual			June 30, 2019						December 31, 2018
	Principal Amount		Maturity Date	Interest Rate(b)			Principal		Unamortized Debt Costs		Carrying Value		Principal		Unamortized Debt Costs		Carrying Value
Lazard Group 2020    Senior Notes (a)	$	500,000	11/14/20		4.25	%	$	-	$	-	$	-	$	250,000	$	863	$	249,137
Lazard Group 2025    Senior Notes		400,000	2/13/25		3.75	%		400,000		2,652		397,348		400,000		2,888		397,112
Lazard Group 2027    Senior Notes		300,000	3/1/27		3.625	%		300,000		3,018		296,982		300,000		3,215		296,785
Lazard Group 2028    Senior Notes		500,000	9/19/28		4.50	%		500,000		8,323		491,677		500,000		8,774		491,226
Lazard Group 2029    Senior Notes (a)		500,000	3/11/29		4.375	%		500,000		7,876		492,124		-		-		-
Total							$	1,700,000	$	21,869	$	1,678,131	$	1,450,000	$	15,740	$	1,434,260

(a) During March 2019, Lazard Group completed an offering of $500,000 aggregate principal amount of 4.375% senior notes due 2029 (the “2029 Notes”).  Interest on the 2029 Notes is payable semi-annually on March 11 and September 11 of each year, beginning September 11, 2019.  Lazard Group used a portion of the net proceeds of the 2029 Notes to redeem or otherwise retire $250,000 aggregate principal amount of the 4.25% senior notes due 2020 (the “2020 Notes”). In March 2019, $167,943 aggregate principal amount was redeemed or otherwise retired, and the remaining $82,057 was redeemed or otherwise retired in April 2019.

(b) The effective interest rates of Lazard Group’s 3.75% senior notes due February 13, 2025 (the “2025 Notes”), Lazard Group’s 3.625% senior notes due March 1, 2027 (the “2027 Notes”), Lazard Group’s 4.50% senior notes due September 19, 2028 (the “2028 Notes”) and the 2029 Notes are 3.87%, 3.76%, 4.68% and 4.54% respectively.

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Stockholders' Equity (Tables)

6 Months Ended

Jun. 30, 2019

Equity [Abstract]

Schedule of Share Repurchase Authorized by Board of Directors

Share Repurchase Program—During the six month period ended June 30, 2019 and since 2017, the Board of Directors of Lazard authorized the repurchase of Class A common stock as set forth in the table below:

Date	Repurchase Authorization		Expiration
October 2017	$	200,000	December 31, 2019
April 2018	$	300,000	December 31, 2020
October 2018	$	300,000	December 31, 2020
February 2019	$	300,000	December 31, 2020

Schedule of Shares Repurchased Under the Share Repurchase Program

The Company expects that the share repurchase program will continue to be used to offset a portion of the shares that have been or will be issued under the Lazard Ltd 2008 Incentive Compensation Plan (the “2008 Plan”) and the Lazard Ltd 2018 Incentive Compensation Plan (the “2018 Plan”). Pursuant to the share repurchase program, purchases have been made in the open market or through privately negotiated transactions. The rate at which the Company purchases shares in connection with the share repurchase program may vary from quarter to quarter due to a variety of factors. Purchases with respect to such program are set forth in the table below:

Six Months Ended June 30:	Number of Shares Purchased		Average Price Per Share
2018		4,147,526	$	53.96
2019		9,715,003	$	36.20

Accumulated Other Comprehensive Income (Loss), Net of Tax

Accumulated Other Comprehensive Income (Loss), Net of Tax—The tables below reflect the balances of each component of AOCI at June 30, 2019 and 2018 and activity during the three month and six month periods then ended:

	Three Months Ended June 30, 2019
	Currency Translation Adjustments			Employee Benefit Plans			Total AOCI			Amount Attributable to Noncontrolling Interests			Total Lazard Ltd AOCI
Balance, April 1, 2019	$	(126,357	)	$	(142,502	)	$	(268,859	)	$	(1	)	$	(268,858	)
Activity:
Other comprehensive income (loss) before    reclassifications		(7,053	)		2,812			(4,241	)		(2	)		(4,239	)
Adjustments for items reclassified to earnings,    net of tax		-			1,113			1,113			-			1,113
Net other comprehensive income (loss)		(7,053	)		3,925			(3,128	)		(2	)		(3,126	)
Balance, June 30, 2019	$	(133,410	)	$	(138,577	)	$	(271,987	)	$	(3	)	$	(271,984	)

	Six Months Ended June 30, 2019
	Currency Translation Adjustments			Employee Benefit Plans			Total AOCI			Amount Attributable to Noncontrolling Interests			Total Lazard Ltd AOCI
Balance, January 1, 2019	$	(130,137	)	$	(143,683	)	$	(273,820	)	$	(2	)	$	(273,818	)
Activity:
Other comprehensive income (loss) before    reclassifications		(3,273	)		2,861			(412	)		(1	)		(411	)
Adjustments for items reclassified to earnings,    net of tax		-			2,245			2,245			-			2,245
Net other comprehensive income (loss)		(3,273	)		5,106			1,833			(1	)		1,834
Balance, June 30, 2019	$	(133,410	)	$	(138,577	)	$	(271,987	)	$	(3	)	$	(271,984	)

	Three Months Ended June 30, 2018
	Currency Translation Adjustments			Employee Benefit Plans			Total AOCI			Amount Attributable to Noncontrolling Interests			Total Lazard Ltd AOCI
Balance, April 1, 2018	$	(66,189	)	$	(152,936	)	$	(219,125	)	$	(1	)	$	(219,124	)
Activity:
Other comprehensive income (loss) before    reclassifications		(43,453	)		8,300			(35,153	)		(1	)		(35,152	)
Adjustments for items reclassified to earnings,    net of tax		-			777			777			-			777
Net other comprehensive income (loss)		(43,453	)		9,077			(34,376	)		(1	)		(34,375	)
Balance, June 30, 2018	$	(109,642	)	$	(143,859	)	$	(253,501	)	$	(2	)	$	(253,499	)

	Six Months Ended June 30, 2018
	Currency Translation Adjustments			Employee Benefit Plans			Total AOCI			Amount Attributable to Noncontrolling Interests			Total Lazard Ltd AOCI
Balance, January 1, 2018	$	(83,535	)	$	(148,984	)	$	(232,519	)	$	(1	)	$	(232,518	)
Activity:
Other comprehensive income (loss) before    reclassifications		(26,107	)		3,286			(22,821	)		(1	)		(22,820	)
Adjustments for items reclassified to earnings,    net of tax		-			1,839			1,839			-			1,839
Net other comprehensive income (loss)		(26,107	)		5,125			(20,982	)		(1	)		(20,981	)
Balance, June 30, 2018	$	(109,642	)	$	(143,859	)	$	(253,501	)	$	(2	)	$	(253,499	)

Adjustments for Items Reclassified Out of AOCI

The table below reflects adjustments for items reclassified out of AOCI, by component, for the three month and six month periods ended June 30, 2019 and 2018:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2019		2018		2019		2018
Amortization relating to employee benefit plans (a)	$	1,287	$	1,245	$	2,597	$	2,523
Less - related income taxes		174		468		352		684
Total reclassifications, net of tax	$	1,113	$	777	$	2,245	$	1,839

(a) Included in the computation of net periodic benefit cost (see Note 15). Such amounts are included in “operating expenses—other” on the condensed consolidated statements of operations.

Net Income Attributable to Noncontrolling Interests

The tables below summarize net income attributable to noncontrolling interests for the three month and six month periods ended June 30, 2019 and 2018 and noncontrolling interests as of June 30, 2019 and December 31, 2018 in the Company’s condensed consolidated financial statements:

	Net Income Attributable to Noncontrolling Interests
	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2019		2018		2019		2018
Edgewater	$	7,501	$	1,415	$	6,935	$	3,383
Consolidated VIEs		234		-		234		-
Other		1		1		1		2
Total	$	7,736	$	1,416	$	7,170	$	3,385

	Noncontrolling Interests as of
	June 30,		December 31,
	2019		2018
Edgewater	$	52,111	$	52,695
Profits interest participation rights		35,254		535
Consolidated VIEs		11,698		-
Other		13		12
Total	$	99,076	$	53,242

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Incentive Plans (Tables)

6 Months Ended

Jun. 30, 2019

Summary of Impact of Share-Based Incentive Plans on Compensation and Benefits Expense

The following reflects the amortization expense recorded with respect to share-based incentive plans within “compensation and benefits” expense (with respect to RSUs, PRSUs and other share-based awards) and “professional services” expense (with respect to DSUs) within the Company’s accompanying condensed consolidated statements of operations for the three month and six month periods ended June 30, 2019 and 2018:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2019		2018		2019		2018
Share-based incentive awards:
RSUs	$	48,194	$	55,635	$	103,391	$	116,522
PRSUs		928		17,051		2,249		28,018
Restricted Stock		8,085		12,600		17,597		23,373
Profits interest participation rights		17,413		-		35,881		-
DSUs		1,782		1,724		1,965		1,917
Total	$	76,402	$	87,010	$	161,083	$	169,830

Summary of LFI and Other Similar Deferred Compensation Arrangements

The following is a summary of activity relating to LFI and other similar deferred compensation arrangements during the six month period ended June 30, 2019:

	Prepaid Compensation Asset			Compensation Liability
Balance, January 1, 2019	$	76,362		$	188,022
Granted		101,340			101,340
Settled		-			(82,990	)
Forfeited		(646	)		(983	)
Amortization		(59,283	)		-
Change in fair value related to:
Increase in fair value of underlying investments		-			20,354
Adjustment for estimated forfeitures		-			3,198
Other		275			495
Balance, June 30, 2019	$	118,048		$	229,436

The following is a summary of the impact of LFI and other similar deferred compensation arrangements on “compensation and benefits” expense within the accompanying condensed consolidated statements of operations for the three month and six month periods ended June 30, 2019 and 2018:

	Three Months Ended					Six Months Ended
	June 30,					June 30,
	2019		2018			2019		2018
Amortization, net of forfeitures	$	44,210	$	36,293		$	62,144	$	52,129
Change in the fair value of underlying investments		6,484		(499	)		20,354		(1,935	)
Total	$	50,694	$	35,794		$	82,498	$	50,194

Restricted Stock Units and Deferred Stock Units [Member]

Schedule of Activity Relating to Share-based Awards

The following is a summary of activity relating to RSUs and DSUs during the six month period ended June 30, 2019:

	RSUs					DSUs
	Units			Weighted Average Grant Date Fair Value		Units		Weighted Average Grant Date Fair Value
Balance, January 1, 2019		11,362,306		$	43.78		323,546	$	39.27
Granted (including 566,194 RSUs relating to dividend    participation)		5,564,865		$	38.32		61,449	$	31.97
Forfeited		(368,195	)	$	42.68		-	$	-
Settled		(5,795,423	)	$	37.03		-	$	-
Balance, June 30, 2019		10,763,553		$	44.63		384,995	$	38.10

Restricted Stock Awards Class A [Member]

Schedule of Activity Relating to Share-based Awards

The following is a summary of activity related to shares of restricted Class A common stock associated with compensation arrangements during the six month period ended June 30, 2019:

	Restricted Shares			Weighted Average Grant Date Fair Value
Balance, January 1, 2019		1,541,058		$	43.16
Granted		1,039,736		$	35.32
Forfeited		(194,097	)	$	41.28
Settled		(1,159,850	)	$	38.37
Balance, June 30, 2019		1,226,847		$	41.34

PRSUs [Member]

Schedule of Activity Relating to Share-based Awards

The following is a summary of activity relating to PRSUs during the six month period ended June 30, 2019:

	PRSUs			Weighted Average Grant Date Fair Value
Balance, January 1, 2019		1,771,795		$	38.66
Settled		(1,171,081	)	$	32.44
Balance, June 30, 2019		600,714		$	50.78

Profits Interest Participation Rights [Member]

Schedule of Activity Relating to Share-based Awards

The following is a summary of activity relating to profits interest participation rights, including PRPUs, during the six month period ended June 30, 2019:

	Profits Interest Participation Rights		Weighted Average Grant Date Fair Value
Balance, January 1, 2019		-		-
Granted (a)		1,462,702	$	38.65
Balance, June 30, 2019		1,462,702	$	38.65

(a) Table includes the target number of PRPUs assuming the achievement of applicable performance conditions at the target level.

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Employee Benefit Plans (Tables)

6 Months Ended

Jun. 30, 2019

Compensation And Retirement Disclosure [Abstract]

Components of Net Periodic Benefit Cost (Credit)

The following table summarizes the components of net periodic benefit cost (credit) related to the Company’s pension plans for the three month and six month periods ended June 30, 2019 and 2018:

	Three Months Ended June 30,
	2019			2018
Components of Net Periodic Benefit Cost (Credit):
Service cost	$	205		$	223
Interest cost		3,858			3,977
Expected return on plan assets		(6,873	)		(7,583	)
Amortization of:
Prior service cost		27			-
Net actuarial loss (gain)		1,260			1,245
Settlement loss		1,739			-
Net periodic benefit cost (credit)	$	216		$	(2,138	)

	Six Months Ended June 30,
	2019			2018
Components of Net Periodic Benefit Cost (Credit):
Service cost	$	412		$	453
Interest cost		7,760			8,039
Expected return on plan assets		(13,899	)		(15,366	)
Amortization of:
Prior service cost		56			-
Net actuarial loss (gain)		2,541			2,523
Settlement loss		3,522			-
Net periodic benefit cost (credit)	$	392		$	(4,351	)

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Net Income Per Share of Class A Common Stock (Tables)

6 Months Ended

Jun. 30, 2019

Earnings Per Share [Abstract]

Company's Basic and Diluted Net Income Per Share and Weighted Average Shares Outstanding

The Company’s basic and diluted net income per share calculations using the “two-class” method for the three month and six month periods ended June 30, 2019 and using the “treasury stock” method for the three month and six month periods ended June 30, 2018 are presented below:

	Three Months Ended					Six Months Ended
	June 30,					June 30,
	2019			2018		2019			2018
Net income attributable to Lazard Ltd	$	65,777		$	146,963	$	162,819		$	306,655
Add - adjustment for earnings attributable to participating    securities		(1,604	)		-		(1,604	)		-
Net income attributable to Lazard Ltd - basic		64,173			146,963		161,215			306,655
Add - adjustment for earnings attributable to participating    securities		5			-		5			-
Net income attributable to Lazard Ltd - diluted	$	64,178		$	146,963	$	161,220		$	306,655
Weighted average number of shares of Class A common    stock outstanding		110,076,582			120,049,627		110,847,112			119,872,688
Add - adjustment for shares of Class A common stock    issuable on a non-contingent basis		1,904,622			256,630		1,115,617			245,494
Weighted average number of shares of Class A common    stock outstanding - basic		111,981,204			120,306,257		111,962,729			120,118,182
Add - dilutive effect, as applicable, of:
Weighted average number of incremental shares of Class A    common stock issuable from share-based    incentive compensation		4,194,145			9,942,797		6,534,988			11,077,543
Weighted average number of shares of Class A common stock    outstanding - diluted		116,175,349			130,249,054		118,497,717			131,195,725
Net income attributable to Lazard Ltd per share of Class    A common stock:
Basic	$	0.57		$	1.22	$	1.44		$	2.55
Diluted	$	0.55		$	1.13	$	1.36		$	2.34

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Segment Information (Tables)

6 Months Ended

Jun. 30, 2019

Segment Reporting [Abstract]

Segment's Contribution with Respect to Net Revenue, Operating Expenses, Operating Income (Loss) and Total Assets

Management evaluates segment results based on net revenue and operating income (loss) and believes that the following information provides a reasonable representation of each segment’s contribution with respect to net revenue, operating income (loss) and total assets:

		Three Months Ended						Six Months Ended
		June 30,						June 30,
		2019			2018			2019			2018
Financial Advisory	Net Revenue	$	329,612		$	422,089		$	667,982		$	831,210
	Operating Expenses		276,238			318,177			556,499			642,873
	Operating Income	$	53,374		$	103,912		$	111,483		$	188,337
Asset Management	Net Revenue	$	315,591		$	352,588		$	617,424		$	706,871
	Operating Expenses		219,021			229,561			426,369			459,230
	Operating Income	$	96,570		$	123,027		$	191,055		$	247,641
Corporate	Net Revenue	$	(14,513	)	$	(16,739	)	$	(11,042	)	$	(25,445	)
	Operating Expenses		33,746			10,260			70,148			24,765
	Operating Loss	$	(48,259	)	$	(26,999	)	$	(81,190	)	$	(50,210	)
Total	Net Revenue	$	630,690		$	757,938		$	1,274,364		$	1,512,636
	Operating Expenses		529,005			557,998			1,053,016			1,126,868
	Operating Income	$	101,685		$	199,940		$	221,348		$	385,768

	As Of
	June 30, 2019		December 31, 2018
Total Assets
Financial Advisory	$	981,571	$	859,306
Asset Management		702,530		728,220
Corporate		3,823,372		3,409,715
Total	$	5,507,473	$	4,997,241

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Consolidated VIEs (Tables)

6 Months Ended

Jun. 30, 2019

Variable Interest Entity Consolidated Carrying Amount Assets And Liabilities [Abstract]

Summary of Consolidated VIE Assets and Liabilities

The Company’s consolidated VIE assets and liabilities as reflected in the condensed consolidated statements of financial condition consist of the following at June 30, 2019:

ASSETS
Cash and cash equivalents	$	4,543
Customers and other receivables		353
Investments (a)		89,762
Other assets		572
Total Assets	$	95,230

LIABILITIES
Deposits and other customer payables	$	1,033
Other liabilities		286
Total Liabilities	$	1,319

(a) Includes $81,999 of LFI held by Lazard Group which is eliminated in the condensed consolidated statements of financial condition.

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Organization and Basis of Presentation - Additional Information (Detail) - Segment		6 Months Ended
	Feb. 04, 2019	Jun. 30, 2019	Dec. 31, 2018
Organization And Basis Of Presentation [Line Items]
Governing operating agreement, date	Feb. 04, 2019
Number of business segments		2
Lazard Group LLC [Member]
Organization And Basis Of Presentation [Line Items]
Percentage of common membership interests held		100.00%	100.00%

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Recent Accounting Developments - Additional Information (Detail) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 30, 2019	Jun. 30, 2019	Jan. 01, 2019
New Accounting Pronouncements And Changes In Accounting Principles [Abstract]
Operating lease right-of-use assets	$ 477,432	$ 477,432	$ 502,000
Operating lease liability	$ 555,324	$ 555,324	$ 581,000
U.S. federal statutory income tax rate	21.00%	21.00%

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Revenue Recognition - Representation of Performance Obligations Relate to Nature, Amount, Timing and Uncertainty of Revenue and Cash Flows (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Financial Advisory Segment [Member]
Disaggregation Of Revenue [Line Items]
Net Revenue	$ 329,612	$ 422,089	$ 667,982	$ 831,210
Asset Management Segment [Member]
Disaggregation Of Revenue [Line Items]
Net Revenue	315,591	352,588	617,424	706,871
Asset Management Segment [Member] | Management Fees and Other [Member]
Disaggregation Of Revenue [Line Items]
Net Revenue	310,316	340,160	611,569	688,844
Asset Management Segment [Member] | Incentive Fees [Member]
Disaggregation Of Revenue [Line Items]
Net Revenue	$ 5,275	$ 12,428	$ 5,855	$ 18,027

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Receivables - Schedule of Activity in Allowance for Doubtful Accounts (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Allowance For Doubtful Accounts Receivable Rollforward
Allowance for doubtful accounts receivables, Beginning balance	$ 43,258	$ 38,557	$ 40,164	$ 23,746
Bad debt expense, net of recoveries	(9,380)	666	(5,551)	16,618
Charge-offs, foreign currency translation and other adjustments	(343)	(4,267)	(1,078)	(5,408)
Allowance for doubtful accounts receivables, Ending balance	$ 33,535	$ 34,956	$ 33,535	$ 34,956

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Receivables - Additional Information (Detail) - USD ($)	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017
Accounts, Notes, Loans and Financing Receivable [Line Items]
Receivables past due or deemed uncollectible	$ 45,516,000		$ 42,309,000
Interest-bearing financing fee receivables	79,426,000		90,966,000
Allowance for doubtful accounts receivables	33,535,000	$ 43,258,000	40,164,000	$ 34,956,000	$ 38,557,000	$ 23,746,000
Aggregate carrying amount of non-interest bearing receivables	625,688,000		594,568,000
Financing Receivables [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Allowance for doubtful accounts receivables	$ 0		$ 0

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Investments - Company's Investments and Securities Sold, Not Yet Purchased (Detail) - USD ($) $ in Thousands	Jun. 30, 2019	Dec. 31, 2018
Schedule of Investments [Line Items]
Total investments	$ 575,424	$ 575,148
Investments, at fair value	574,913	574,638
Securities sold, not yet purchased, at fair value (included in "other liabilities")	2,261	3,929
Interest-bearing Deposits [Member]
Schedule of Investments [Line Items]
Total investments	511	510
Debt [Member]
Schedule of Investments [Line Items]
Total investments	124,838	202,874
Investments, at fair value	124,838	202,874
Equities [Member]
Schedule of Investments [Line Items]
Total investments	37,858	32,261
Investments, at fair value	37,858	32,261
Alternative Investment Funds [Member]
Schedule of Investments [Line Items]
Total investments	42,000	17,752
Investments, at fair value	42,000	17,752
Debt Funds [Member]
Schedule of Investments [Line Items]
Total investments	104,756	90,320
Investments, at fair value	104,756	90,320
Equity Funds [Member]
Schedule of Investments [Line Items]
Total investments	223,593	175,088
Investments, at fair value	223,593	175,088
Private Equity Funds [Member]
Schedule of Investments [Line Items]
Total investments	41,868	56,343
Investments, at fair value	41,868	56,343
Funds Total [Member]
Schedule of Investments [Line Items]
Total investments	$ 412,217	$ 339,503

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Investments - Company's Investments and Securities Sold, Not Yet Purchased (Parenthetical) (Detail) - USD ($) $ in Thousands	Jun. 30, 2019	Dec. 31, 2018
Schedule of Investments [Line Items]
Investments	$ 575,424	$ 575,148
Alternative Investment Funds [Member]
Schedule of Investments [Line Items]
Investments	42,000	17,752
Alternative Investment Funds [Member] | Lazard Fund Interests [Member]
Schedule of Investments [Line Items]
Investments	9,665	9,741
Debt Funds [Member]
Schedule of Investments [Line Items]
Investments	104,756	90,320
Debt Funds [Member] | Lazard Fund Interests [Member]
Schedule of Investments [Line Items]
Investments	75,364	60,081
Equity Funds [Member]
Schedule of Investments [Line Items]
Investments	223,593	175,088
Equity Funds [Member] | Lazard Fund Interests [Member]
Schedule of Investments [Line Items]
Investments	$ 172,711	$ 132,038

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Investments - Additional Information (Detail)	6 Months Ended
	Jun. 30, 2019
Minimum [Member] | Interest-bearing Deposits [Member]
Schedule of Investments [Line Items]
Deposits maturity period	3 months
Minimum [Member] | Debt [Member] | U.S. Treasury Securities [Member]
Schedule of Investments [Line Items]
US Treasury securities maturity period	3 months
Maximum [Member] | Interest-bearing Deposits [Member]
Schedule of Investments [Line Items]
Deposits maturity period	1 year
Maximum [Member] | Debt [Member] | U.S. Treasury Securities [Member]
Schedule of Investments [Line Items]
US Treasury securities maturity period	1 year

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Investments - Schedule of Equity Securities and Trading Debt Securities Net Unrealized Investment Gains and Losses (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Net Realized Or Unrealized Gain Loss On Trading Securities [Abstract]
Net unrealized investment gains (losses)	$ 7,229	$ (5,864)	$ 27,152	$ (15,155)

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Fair Value Measurements - Schedule of Classification of Investments and Certain Other Assets and Liabilities Measured at Fair Value on Recurring Basis and Investments Measured at NAV (Detail) - USD ($) $ in Thousands	Jun. 30, 2019	Dec. 31, 2018
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	$ 574,913	$ 574,638
Total Derivative Assets	2,180	11,967
Total investments measured at fair value	577,093	586,605
Securities sold, not yet purchased	2,261	3,929
Contingent consideration liability	4,386	10,009
Total Derivative Liabilities	235,504	188,962
Total of Liabilities Measured at Fair Value	242,151	202,900
Level 1 [Member] | Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Total investments measured at fair value	506,589	515,743
Securities sold, not yet purchased	2,261	3,929
Total of Liabilities Measured at Fair Value	2,261	3,929
Level 2 [Member] | Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Total Derivative Assets	2,180	11,967
Total investments measured at fair value	2,180	11,967
Total Derivative Liabilities	235,504	188,962
Total of Liabilities Measured at Fair Value	235,504	188,962
Level 3 [Member] | Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Total investments measured at fair value	3,737	1,622
Contingent consideration liability	4,386	10,009
Total of Liabilities Measured at Fair Value	4,386	10,009
NAV [Member] | Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Total investments measured at fair value	64,587	57,273
Debt [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	124,838	202,874
Debt [Member] | Level 1 [Member] | Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	124,838	202,874
Equities [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	37,858	32,261
Equities [Member] | Level 1 [Member] | Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	36,252	30,639
Equities [Member] | Level 3 [Member] | Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	1,606	1,622
Alternative Investment Funds [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	42,000	17,752
Alternative Investment Funds [Member] | Level 1 [Member] | Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	17,196	16,863
Alternative Investment Funds [Member] | NAV [Member] | Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	24,804	889
Debt Funds [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	104,756	90,320
Debt Funds [Member] | Level 1 [Member] | Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	104,749	90,313
Debt Funds [Member] | NAV [Member] | Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	7	7
Equity Funds [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	223,593	175,088
Equity Funds [Member] | Level 1 [Member] | Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	223,554	175,054
Equity Funds [Member] | NAV [Member] | Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	39	34
Private Equity Funds [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	41,868	56,343
Private Equity Funds [Member] | Level 3 [Member] | Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	2,131
Private Equity Funds [Member] | NAV [Member] | Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	$ 39,737	$ 56,343

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Fair Value Measurements - Summary of Changes in Fair Value of Company's Level 3 Assets and Liabilities (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Assets:
Beginning Balance	$ 1,618	$ 1,599	$ 1,622	$ 1,592
Net Unrealized/Realized Gains/Losses Included In Earnings	(12)	62	(14)	61
Purchases/Acquisitions/Transfers	2,131	0	2,131	1
Sales/ Dispositions/Settlements	0	0	0	0
Foreign Currency Translation Adjustments	0	(32)	(2)	(25)
Ending Balance	3,737	1,629	3,737	1,629
Liabilities:
Beginning Balance	13,048	28,974	10,009	28,941
Net Unrealized/Realized Gains/Losses Included In Earnings	4,611	(9,346)	7,650	(9,313)
Purchases/Acquisitions/ Transfers	0	0	0	0
Sales/ Dispositions/Settlements	(13,273)	0	(13,273)	0
Foreign Currency Translation Adjustments	0	0	0	0
Ending Balance	4,386	19,628	4,386	19,628
Contingent Consideration Liability [Member]
Liabilities:
Beginning Balance	13,048	28,974	10,009	28,941
Net Unrealized/Realized Gains/Losses Included In Earnings	4,611	(9,346)	7,650	(9,313)
Purchases/Acquisitions/ Transfers	0	0	0	0
Sales/ Dispositions/Settlements	(13,273)	0	(13,273)	0
Foreign Currency Translation Adjustments	0	0	0	0
Ending Balance	4,386	19,628	4,386	19,628
Equities [Member]
Assets:
Beginning Balance	1,618	1,599	1,622	1,592
Net Unrealized/Realized Gains/Losses Included In Earnings	(12)	62	(14)	61
Purchases/Acquisitions/Transfers	0	0	0	1
Sales/ Dispositions/Settlements	0	0	0	0
Foreign Currency Translation Adjustments	0	(32)	(2)	(25)
Ending Balance	1,606	$ 1,629	1,606	$ 1,629
Private Equity Funds [Member]
Assets:
Beginning Balance	0		0
Net Unrealized/Realized Gains/Losses Included In Earnings	0		0
Purchases/Acquisitions/Transfers	2,131		2,131
Sales/ Dispositions/Settlements	0		0
Foreign Currency Translation Adjustments	0		0
Ending Balance	$ 2,131		$ 2,131

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Fair Value Measurements - Summary of Changes in Fair Value of Company's Level 3 Assets and Liabilities (Parenthetical) (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Equities [Member]
Fair Value of Assets and Liabilities Measured on Recurring Basis Unobservable Input Reconciliation [Line Items]
Net unrealized gains (losses)	$ (12)	$ 62	$ (14)	$ 61
Contingent Consideration Liability [Member]
Fair Value of Assets and Liabilities Measured on Recurring Basis Unobservable Input Reconciliation [Line Items]
Net unrealized (gains) losses	$ 4,611	$ (9,346)	$ 7,650	$ (9,313)

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Fair Value Measurements - Additional Information (Detail) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018	Dec. 31, 2018
Fair Value Option Quantitative Disclosures [Line Items]
Transfers between Level 1, 2 and 3 in fair value measurement hierarchy	$ 0	$ 0	$ 0	$ 0
Unfunded Commitments	8,264,000		8,264,000		$ 8,338,000
EGCP III [Member]
Fair Value Option Quantitative Disclosures [Line Items]
Unfunded Commitments	$ 7,602,000		$ 7,602,000
End of the investment period			Oct. 12, 2016
Remaining obligation date			Oct. 12, 2023

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Fair Value Measurements - Fair Value of Certain Investments Based on NAV (Detail) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2019	Dec. 31, 2018
Fair Value Investments Entities That Calculate Net Asset Value Per Share [Line Items]
Fair Value	$ 64,587	$ 57,273
Unfunded Commitments	8,264	8,338
Hedge Funds [Member]
Fair Value Investments Entities That Calculate Net Asset Value Per Share [Line Items]
Fair Value	$ 24,183	$ 299
Hedge Funds [Member] | Monthly [Member]
Fair Value Investments Entities That Calculate Net Asset Value Per Share [Line Items]
Investments Redeemable, Percent	100.00%	100.00%
Hedge Funds [Member] | Minimum [Member]
Fair Value Investments Entities That Calculate Net Asset Value Per Share [Line Items]
Investments Redeemable, Redemption Notice Period	30 days	30 days
Hedge Funds [Member] | Maximum [Member]
Fair Value Investments Entities That Calculate Net Asset Value Per Share [Line Items]
Investments Redeemable, Redemption Notice Period	60 days	60 days
Funds of Funds [Member]
Fair Value Investments Entities That Calculate Net Asset Value Per Share [Line Items]
Fair Value	$ 24	$ 23
Investments Redeemable, Redemption Notice Period	90 days	90 days
Funds of Funds [Member] | Quarterly [Member]
Fair Value Investments Entities That Calculate Net Asset Value Per Share [Line Items]
Investments Redeemable, Percent	100.00%	100.00%
Other [Member]
Fair Value Investments Entities That Calculate Net Asset Value Per Share [Line Items]
Fair Value	$ 597	$ 567
Other [Member] | Daily [Member]
Fair Value Investments Entities That Calculate Net Asset Value Per Share [Line Items]
Investments Redeemable, Percent	6.00%	6.00%
Other [Member] | Monthly [Member]
Fair Value Investments Entities That Calculate Net Asset Value Per Share [Line Items]
Investments Redeemable, Percent	94.00%	94.00%
Other [Member] | Minimum [Member]
Fair Value Investments Entities That Calculate Net Asset Value Per Share [Line Items]
Investments Redeemable, Redemption Notice Period	30 days	30 days
Other [Member] | Maximum [Member]
Fair Value Investments Entities That Calculate Net Asset Value Per Share [Line Items]
Investments Redeemable, Redemption Notice Period	30 days	30 days
Debt Funds [Member]
Fair Value Investments Entities That Calculate Net Asset Value Per Share [Line Items]
Fair Value	$ 7	$ 7
Investments Redeemable, Redemption Notice Period	30 days	30 days
Debt Funds [Member] | Daily [Member]
Fair Value Investments Entities That Calculate Net Asset Value Per Share [Line Items]
Investments Redeemable, Percent	100.00%	100.00%
Equity Funds [Member]
Fair Value Investments Entities That Calculate Net Asset Value Per Share [Line Items]
Fair Value	$ 39	$ 34
Equity Funds [Member] | Daily [Member]
Fair Value Investments Entities That Calculate Net Asset Value Per Share [Line Items]
Investments Redeemable, Percent	23.00%	25.00%
Equity Funds [Member] | Monthly [Member]
Fair Value Investments Entities That Calculate Net Asset Value Per Share [Line Items]
Investments Redeemable, Percent	72.00%	70.00%
Equity Funds [Member] | Annually [Member]
Fair Value Investments Entities That Calculate Net Asset Value Per Share [Line Items]
Investments Redeemable, Percent	5.00%	5.00%
Equity Funds [Member] | Minimum [Member]
Fair Value Investments Entities That Calculate Net Asset Value Per Share [Line Items]
Investments Redeemable, Redemption Notice Period	30 days	30 days
Equity Funds [Member] | Maximum [Member]
Fair Value Investments Entities That Calculate Net Asset Value Per Share [Line Items]
Investments Redeemable, Redemption Notice Period	90 days	90 days
Private Equity Funds [Member] | Equity Growth [Member]
Fair Value Investments Entities That Calculate Net Asset Value Per Share [Line Items]
Fair Value	$ 39,737	$ 56,343
Unfunded Commitments	$ 8,264	$ 8,338
% of Fair Value Not Redeemable	100.00%	100.00%
Estimated Liquidation Period of Investments Not Redeemable, % Next 5 Years	19.00%	14.00%
Estimated Liquidation Period of Investments Not Redeemable, % 5-10 Years	14.00%	34.00%
Estimated Liquidation Period of Investments Not Redeemable, % Thereafter	67.00%	52.00%

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Fair Value Measurements - Fair Value of Certain Investments Based on NAV (Parenthetical) (Detail) - USD ($) $ in Thousands	Jun. 30, 2019	Dec. 31, 2018
Fair Value Investments Entities That Calculate Net Asset Value Per Share [Line Items]
Unfunded Commitments	$ 8,264	$ 8,338
Private Equity Funds [Member] | Consolidated But Not Owned [Member]
Fair Value Investments Entities That Calculate Net Asset Value Per Share [Line Items]
Unfunded Commitments	$ 13,400	$ 14,437

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Derivatives - Fair Values of Derivatives Reported on Condensed Consolidated Statements of Financial Condition (Detail) - USD ($) $ in Thousands	Jun. 30, 2019	Dec. 31, 2018
Derivatives, Fair Value [Line Items]
Derivative Assets	$ 2,180	$ 11,967
Derivative Liabilities	235,504	188,962
Forward Foreign Currency Exchange Rate Contracts [Member]
Derivatives, Fair Value [Line Items]
Derivative Assets	2,180	1,543
Derivative Liabilities	1,442	939
Total Return Swaps and Other [Member]
Derivatives, Fair Value [Line Items]
Derivative Assets		10,424
Derivative Liabilities	4,626	1
LFI and Other Similar Deferred Compensation Arrangements [Member]
Derivatives, Fair Value [Line Items]
Derivative Liabilities	$ 229,436	$ 188,022

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Derivatives - Fair Values of Derivatives Reported on Condensed Consolidated Statements of Financial Condition (Parenthetical) (Detail) - Total Return Swaps [Member] - USD ($) $ in Thousands	Jun. 30, 2019	Dec. 31, 2018
Derivatives, Fair Value [Line Items]
Gross derivative assets	$ 139	$ 10,792
Gross derivative liability	4,765	$ 369
Cash collateral pledged for total return swaps	$ 5,950

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Derivatives - Net Gains (Losses) with Respect to Derivative Instruments Not Designated as Hedging Instruments (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Derivative Instruments, Gain (Loss) [Line Items]
Gains (losses) on derivatives instruments	$ (11,884)	$ 7,525	$ (28,891)	$ 8,134
Forward Foreign Currency Exchange Rate Contracts [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Gains (losses) on derivatives not designated as hedging instruments	(3,424)	6,236	1,096	3,753
LFI and Other Similar Deferred Compensation Arrangements [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Gains (losses) on derivatives not designated as hedging instruments	(6,484)	499	(20,354)	1,935
Total Return Swaps and Other [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Gains (losses) on derivatives not designated as hedging instruments	$ (1,976)	$ 790	$ (9,633)	$ 2,446

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Property - Components of Property (Detail) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2019	Dec. 31, 2018
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 557,575	$ 552,716
Less - Accumulated depreciation and amortization	351,119	339,770
Property	206,456	212,946
Buildings [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 144,148	145,034
Property, plant and equipment, useful life	33 years
Leasehold Improvements [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 188,736	188,956
Leasehold Improvements [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, useful life	3 years
Leasehold Improvements [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, useful life	20 years
Furniture and Equipment [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 205,607	204,585
Furniture and Equipment [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, useful life	3 years
Furniture and Equipment [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, useful life	10 years
Construction in Progress [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 19,084	$ 14,141

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Leases - Summary of Components of Operating Lease Expense (Detail) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 30, 2019	Jun. 30, 2019
Leases [Abstract]
Operating lease cost	$ 18,910	$ 38,900
Variable lease cost	4,802	9,051
Less - sublease income	1,692	3,462
Total	$ 22,020	$ 44,489

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Leases - Summary of Supplemental Cash Flow Information And Certain Other Information Related to Operating Leases (Detail) $ in Thousands	6 Months Ended
	Jun. 30, 2019 USD ($)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$ 39,759
Operating lease right-of-use assets obtained in exchange for operating lease liabilities	$ 504,706
Weighted average remaining lease term	12 years
Weighted average discount rate	4.10%

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Leases - Summary of Maturities of Operating Lease Liabilities Outstanding (Detail) - USD ($) $ in Thousands	Jun. 30, 2019	Jan. 01, 2019
Leases [Abstract]
2019 (July 1 through December 31)	$ 39,879
2020	76,856
2021	72,870
2022	56,879
2023	52,228
2024	51,045
Thereafter	360,876
Total lease payments	710,633
Less - Discount	155,309
Operating lease liabilities	$ 555,324	$ 581,000

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Leases - Schedule of Prior Adoption For Future Minimum Rental Payment for Operating Leases (Detail) $ in Thousands	Dec. 31, 2018 USD ($)
Leases [Abstract]
Minimum Rental Commitments Operating - 2019	$ 86,839
Minimum Rental Commitments Operating - 2020	89,445
Minimum Rental Commitments Operating - 2021	83,701
Minimum Rental Commitments Operating - 2022	70,780
Minimum Rental Commitments Operating - 2023	59,973
Minimum Rental Commitments Operating - Thereafter	488,612
Total minimum rental commitments	879,350
Less - sublease proceeds	26,941
Net rental commitments	$ 852,409

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Goodwill and Other Intangible Assets - Components of Goodwill and Other Intangible Assets (Detail) - USD ($) $ in Thousands	Jun. 30, 2019	Dec. 31, 2018	Jun. 30, 2018	Dec. 31, 2017
Goodwill And Intangible Assets Disclosure [Abstract]
Goodwill	$ 371,536	$ 371,561	$ 377,264	$ 385,292
Other intangible assets (net of accumulated amortization)	2,900	3,757
Goodwill and other intangible assets, Total	$ 374,436	$ 375,318

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Goodwill and Other Intangible Assets - Additional Information (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018	Dec. 31, 2018	Dec. 31, 2017
Goodwill And Intangible Assets [Line Items]
Goodwill	$ 371,536	$ 377,264	$ 371,536	$ 377,264	$ 371,561	$ 385,292
Amortization of intangible assets	431	$ 863	862	$ 1,696
Financial Advisory Segment [Member]
Goodwill And Intangible Assets [Line Items]
Goodwill	306,995		306,995		307,020
Asset Management Segment [Member]
Goodwill And Intangible Assets [Line Items]
Goodwill	$ 64,541		$ 64,541		$ 64,541

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Goodwill and Other Intangible Assets - Changes in Carrying Amount of Goodwill (Detail) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018
Goodwill And Intangible Assets Disclosure [Abstract]
Beginning Balance	$ 371,561	$ 385,292
Foreign currency translation adjustments	(25)	(8,028)
Ending Balance	$ 371,536	$ 377,264

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Goodwill and Other Intangible Assets - Gross Cost and Accumulated Amortization of Other Intangible Assets (Detail) - USD ($) $ in Thousands	Jun. 30, 2019	Dec. 31, 2018
Finite-Lived Intangible Assets [Line Items]
Other intangible assets, Gross Cost	$ 69,808	$ 69,706
Other intangible assets, accumulated amortization	66,908	65,949
Other intangible assets, Net Carrying Amount	2,900	3,757
Success/Incentive Fees [Member]
Finite-Lived Intangible Assets [Line Items]
Other intangible assets, Gross Cost	35,322	35,232
Other intangible assets, accumulated amortization	33,075	32,235
Other intangible assets, Net Carrying Amount	2,247	2,997
Management Fees, Customer Relationships and Non-Compete Agreements [Member]
Finite-Lived Intangible Assets [Line Items]
Other intangible assets, Gross Cost	34,486	34,474
Other intangible assets, accumulated amortization	33,833	33,714
Other intangible assets, Net Carrying Amount	$ 653	$ 760

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Goodwill and Other Intangible Assets - Estimated Future Amortization Expense (Detail) $ in Thousands	Jun. 30, 2019 USD ($)
Goodwill And Intangible Assets Disclosure [Abstract]
2019 (July 1 through December 31)	$ 862
2020	1,700
2021	150
2022	150
2023	38
Total amortization expense	$ 2,900

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Senior Debt - Senior Debt (Detail) - USD ($)	6 Months Ended
	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018
Debt Instrument [Line Items]
Senior Debt, Outstanding Principal	$ 1,700,000,000		$ 1,450,000,000
Senior Debt, Outstanding Unamortized Debt Costs	21,869,000		15,740,000
Senior Debt, Outstanding Carrying Value	1,678,131,000		1,434,260,000
Lazard Group 4.25% Senior Notes [Member]
Debt Instrument [Line Items]
Senior Debt, Initial Principal Amount	$ 500,000,000
Senior Debt, Maturity Date	Nov. 14, 2020
Senior Debt, Annual Interest Rate	4.25%	4.25%
Senior Debt, Outstanding Principal			250,000,000
Senior Debt, Outstanding Unamortized Debt Costs			863,000
Senior Debt, Outstanding Carrying Value			249,137,000
Lazard Group 3.75% Senior Notes [Member]
Debt Instrument [Line Items]
Senior Debt, Initial Principal Amount	$ 400,000,000
Senior Debt, Maturity Date	Feb. 13, 2025
Senior Debt, Annual Interest Rate	3.75%
Senior Debt, Outstanding Principal	$ 400,000,000		400,000,000
Senior Debt, Outstanding Unamortized Debt Costs	2,652,000		2,888,000
Senior Debt, Outstanding Carrying Value	397,348,000		397,112,000
Lazard Group 3.625% Senior Notes [Member]
Debt Instrument [Line Items]
Senior Debt, Initial Principal Amount	$ 300,000,000
Senior Debt, Maturity Date	Mar. 01, 2027
Senior Debt, Annual Interest Rate	3.625%
Senior Debt, Outstanding Principal	$ 300,000,000		300,000,000
Senior Debt, Outstanding Unamortized Debt Costs	3,018,000		3,215,000
Senior Debt, Outstanding Carrying Value	296,982,000		296,785,000
Lazard Group 4.50% Senior Notes [Member]
Debt Instrument [Line Items]
Senior Debt, Initial Principal Amount	$ 500,000,000
Senior Debt, Maturity Date	Sep. 19, 2028
Senior Debt, Annual Interest Rate	4.50%
Senior Debt, Outstanding Principal	$ 500,000,000		500,000,000
Senior Debt, Outstanding Unamortized Debt Costs	8,323,000		8,774,000
Senior Debt, Outstanding Carrying Value	491,677,000		$ 491,226,000
Lazard Group 4.375% Senior Notes [Member]
Debt Instrument [Line Items]
Senior Debt, Initial Principal Amount	$ 500,000,000	$ 500,000,000
Senior Debt, Maturity Date	Mar. 11, 2029
Senior Debt, Annual Interest Rate	4.375%	4.375%
Senior Debt, Outstanding Principal	$ 500,000,000
Senior Debt, Outstanding Unamortized Debt Costs	7,876,000
Senior Debt, Outstanding Carrying Value	$ 492,124,000

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Senior Debt - Senior Debt (Parenthetical) (Detail) - USD ($)		3 Months Ended	6 Months Ended
	Apr. 30, 2019	Mar. 31, 2019	Jun. 30, 2019
Debt Instrument [Line Items]
Redemption of senior debt aggregate principal amount	$ 82,057,000	$ 167,943,000
Lazard Group 4.375% Senior Notes [Member]
Debt Instrument [Line Items]
Senior Debt, Initial Principal Amount		$ 500,000,000	$ 500,000,000
Interest rate, payment terms			Interest on the 2029 Notes is payable semi-annually on March 11 and September 11 of each year, beginning September 11, 2019
Senior notes interest rate		4.375%	4.375%
Original Maturity Date			Mar. 11, 2029
Effective interest rates of senior notes			4.54%
Lazard Group 4.25% Senior Notes [Member]
Debt Instrument [Line Items]
Senior Debt, Initial Principal Amount			$ 500,000,000
Senior notes interest rate		4.25%	4.25%
Redemption of senior debt aggregate principal amount		$ 250,000,000
Original Maturity Date			Nov. 14, 2020
Lazard Group 3.75% Senior Notes [Member]
Debt Instrument [Line Items]
Senior Debt, Initial Principal Amount			$ 400,000,000
Senior notes interest rate			3.75%
Original Maturity Date			Feb. 13, 2025
Effective interest rates of senior notes			3.87%
Lazard Group 3.625% Senior Notes [Member]
Debt Instrument [Line Items]
Senior Debt, Initial Principal Amount			$ 300,000,000
Senior notes interest rate			3.625%
Original Maturity Date			Mar. 01, 2027
Effective interest rates of senior notes			3.76%
Lazard Group 4.50% Senior Notes [Member]
Debt Instrument [Line Items]
Senior Debt, Initial Principal Amount			$ 500,000,000
Senior notes interest rate			4.50%
Original Maturity Date			Sep. 19, 2028
Effective interest rates of senior notes			4.68%

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Senior Debt - Additional Information (Detail) - USD ($)	Sep. 25, 2015	Jun. 30, 2019	Dec. 31, 2018
Debt Instrument [Line Items]
Senior debt		$ 1,678,131,000	$ 1,434,260,000
Unused Lines of Credit [Member]
Debt Instrument [Line Items]
Unused lines of credit		168,000,000
Senior Debt [Member]
Debt Instrument [Line Items]
Senior debt		1,678,131,000	1,434,260,000
Fair value of senior debt		1,782,000,000	1,429,000,000
LFB [Member] | Unused Lines of Credit [Member]
Debt Instrument [Line Items]
Unused lines of credit		17,000,000
Amended and Restated Credit Agreement [Member]
Debt Instrument [Line Items]
Senior revolving credit facility	$ 150,000,000
Duration of senior revolving credit facility, in years	5 years
Expiration of credit facility	2020-09
Outstanding credit facility		$ 0	$ 0

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Commitments and Contingencies - Additional Information (Detail) - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2019	Dec. 31, 2016
Business Acquisitions [Member]
Other Commitments [Line Items]
Number of contingent additional shares earned including dividend equivalent amount	368,635
Business Acquisitions [Member] | Class A Common Stock [Member]
Other Commitments [Line Items]
Common stock issued and issuable		40,524
Business Acquisitions [Member] | Class A Common Stock [Member] | Non-Contingent [Member]
Other Commitments [Line Items]
Common stock issued and issuable		202,984
Business Acquisitions [Member] | Class A Common Stock [Member] | Maximum [Member]
Other Commitments [Line Items]
Contingent shares issuable upon satisfaction of performance thresholds		499,793
LFB [Member]
Other Commitments [Line Items]
Guarantees indemnifications	$ 3,469,000
Collateral/counter-guarantees	3,469,000
Other commitments	0
LFNY [Member]
Other Commitments [Line Items]
Other commitments	$ 0

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Stockholders' Equity - Schedule of Share Repurchase Authorized by Board of Directors (Detail)	6 Months Ended
	Jun. 30, 2019 USD ($)
October, 2017 [Member]
Equity, Class of Treasury Stock [Line Items]
Share Repurchase Authorization	$ 200,000,000
Expiration	Dec. 31, 2019
April, 2018 [Member]
Equity, Class of Treasury Stock [Line Items]
Share Repurchase Authorization	$ 300,000,000
Expiration	Dec. 31, 2020
October, 2018 [Member]
Equity, Class of Treasury Stock [Line Items]
Share Repurchase Authorization	$ 300,000,000
Expiration	Dec. 31, 2020
February, 2019 [Member]
Equity, Class of Treasury Stock [Line Items]
Share Repurchase Authorization	$ 300,000,000
Expiration	Dec. 31, 2020

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Stockholders' Equity - Schedule of Shares Repurchased Under the Share Repurchase Program (Detail) - $ / shares	6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018
Share Repurchase Program [Abstract]
Purchase of Class A common stock (in shares)	9,715,003	4,147,526
Average Price Per Share	$ 36.20	$ 53.96

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Stockholders' Equity - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands		3 Months Ended		6 Months Ended
	Jul. 24, 2019	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018	Dec. 31, 2018
Schedule Of Stockholders Equity [Line Items]
Aggregate value of all shares repurchased		$ 159,615	$ 77,846	$ 351,712	$ 223,795
Share repurchase remaining authorization		$ 243,800		$ 243,800
Preferred stock, shares authorized		15,000,000		15,000,000		15,000,000
Preferred stock, par value		$ 0.01		$ 0.01		$ 0.01
Dividend declared per share of common stock		$ 0.47	$ 0.44	$ 1.41	$ 2.15
Subsequent Event [Member] | Quarterly Dividend [Member]
Schedule Of Stockholders Equity [Line Items]
Dividend declared per share of common stock	$ 0.47
Dividend payable date	Aug. 16, 2019
Dividend date of record	Aug. 05, 2019
Dividend declare date	Jul. 24, 2019
April and October, 2018 and February, 2019 [Member]
Schedule Of Stockholders Equity [Line Items]
Share repurchase authorization expiration date				Dec. 31, 2020
Class A Common Stock [Member] | Executive Officers [Member]
Schedule Of Stockholders Equity [Line Items]
Aggregate value of all shares repurchased				$ 14,600	$ 16,400
Series A Preferred Stock [Member]
Schedule Of Stockholders Equity [Line Items]
Preferred stock, shares outstanding		0		0		0
Series B Preferred Stock [Member]
Schedule Of Stockholders Equity [Line Items]
Preferred stock, shares outstanding		0		0		0

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Stockholders' Equity - Accumulated Other Comprehensive Income (Loss), Net of Tax (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance	$ 771,372	$ 1,056,181	$ 970,093	$ 1,258,905
Other comprehensive income (loss) before reclassifications	(4,241)	(35,153)	(412)	(22,821)
Adjustments for items reclassified to earnings, net of tax	1,113	777	2,245	1,839
OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX	(3,128)	(34,376)	1,833	(20,982)
Balance	717,878	1,113,104	717,878	1,113,104
Currency Translation Adjustments [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance	(126,357)	(66,189)	(130,137)	(83,535)
Other comprehensive income (loss) before reclassifications	(7,053)	(43,453)	(3,273)	(26,107)
Adjustments for items reclassified to earnings, net of tax	0	0	0	0
OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX	(7,053)	(43,453)	(3,273)	(26,107)
Balance	(133,410)	(109,642)	(133,410)	(109,642)
Employee Benefit Plans [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance	(142,502)	(152,936)	(143,683)	(148,984)
Other comprehensive income (loss) before reclassifications	2,812	8,300	2,861	3,286
Adjustments for items reclassified to earnings, net of tax	1,113	777	2,245	1,839
OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX	3,925	9,077	5,106	5,125
Balance	(138,577)	(143,859)	(138,577)	(143,859)
AOCI Attributable to Noncontrolling Interest [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance	(1)	(1)	(2)	(1)
Other comprehensive income (loss) before reclassifications	(2)	(1)	(1)	(1)
OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX	(2)	(1)	(1)	(1)
Balance	(3)	(2)	(3)	(2)
Accumulated Other Comprehensive Income (Loss), Net of Tax [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance	(268,858)	(219,124)	(273,818)	(232,518)
Other comprehensive income (loss) before reclassifications	(4,239)	(35,152)	(411)	(22,820)
Adjustments for items reclassified to earnings, net of tax	1,113	777	2,245	1,839
OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX	(3,126)	(34,375)	1,834	(20,981)
Balance	(271,984)	(253,499)	(271,984)	(253,499)
Total AOCI [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance	(268,859)	(219,125)	(273,820)	(232,519)
Balance	$ (271,987)	$ (253,501)	$ (271,987)	$ (253,501)

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Stockholders' Equity - Adjustments for Items Reclassified Out of AOCI (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items]
Total reclassifications, net of tax	$ 1,113	$ 777	$ 2,245	$ 1,839
Accumulated Defined Benefit Plans Adjustment [Member]
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items]
Amortization relating to employee benefit plans	1,287	1,245	2,597	2,523
Less - related income taxes	174	468	352	684
Total reclassifications, net of tax	$ 1,113	$ 777	$ 2,245	$ 1,839

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Stockholders' Equity - Net Income Attributable to Noncontrolling Interests (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018	Dec. 31, 2018
Change In Ownership Interest [Line Items]
Net Income Attributable to Noncontrolling Interests	$ 7,736	$ 1,416	$ 7,170	$ 3,385
Noncontrolling interests	99,076		99,076		$ 53,242
Profits Interest Participation Rights [Member]
Change In Ownership Interest [Line Items]
Noncontrolling interests	35,254		35,254		535
Consolidated VIEs [Member]
Change In Ownership Interest [Line Items]
Net Income Attributable to Noncontrolling Interests	234		234
Noncontrolling interests	11,698		11,698
Edgewater [Member]
Change In Ownership Interest [Line Items]
Net Income Attributable to Noncontrolling Interests	7,501	1,415	6,935	3,383
Noncontrolling interests	52,111		52,111		52,695
Other [Member]
Change In Ownership Interest [Line Items]
Net Income Attributable to Noncontrolling Interests	1	$ 1	1	$ 2
Noncontrolling interests	$ 13		$ 13		$ 12

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Incentive Plans - Additional Information (Detail) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2019	Apr. 24, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of RSUs issued in connection with dividend participation rights	566,194
Lazard Fund Interests [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation expense, years	1 year
Non-Executive [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of annual compensation received by directors in the form of DSUs	55.00%
RSUs [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock conversion basis	one-for-one
Grant date fair value, amortized periods	generally one-third after two years, and the remaining two-thirds after the third year
Number of RSUs issued in connection with dividend participation rights	566,194
Charges to retained earnings, net of estimated forfeitures	$ 20,142
Unrecognized compensation expense	$ 195,263
Unrecognized compensation expense, years	10 months 24 days
DSUs [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Annual compensation received for service	51,192
Units granted under the directors deferred unit plan	10,257
Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation expense	$ 28,337
Unrecognized compensation expense, years	1 year
PRSUs [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation expense	$ 4,249
Unrecognized compensation expense, years	8 months 12 days
Percentage of target number of shares subject to each PRSU no longer subject to forfeiture due to threshold level of performance being achieved	25.00%
Descriptions of vesting period	PRSUs will vest on a single date approximately three years following the date of the grant
Vesting period	3 years
PRSUs target share distribution for Class A common stock, description	The target number of shares of Class A common stock subject to each PRSU is one; however, based on the achievement of the performance criteria, the number of shares of Class A common stock that may be received in connection with each PRSU generally can range from zero to two times the target number.
Profits Interest Participation Rights [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock conversion basis	one-for-one
Unrecognized compensation expense	$ 20,652
Unrecognized compensation expense, years	1 year 3 months 18 days
Descriptions of vesting period	Profits interest participation rights generally provide for vesting approximately three years following the grant date
Vesting period	3 years
PRSUs target share distribution for Class A common stock, description	The target number of shares of Class A common stock subject to each PRPU is one. Based on the achievement of performance criteria, as determined by the Compensation Committee, the number of shares of Class A common stock that may be received in connection with each PRPU award will range from zero to two times the target number.
Percentage of target number of shares subject to the applicable units no longer subject to forfeiture due to threshold level of performance being achieved	25.00%
Class A Common Stock [Member] | RSUs [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Withholding taxes in lieu of share delivery	2,023,986
Delivery of common stock associated with stock awards	3,771,437
Class A Common Stock [Member] | Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Withholding taxes in lieu of share delivery	370,777
Delivery of common stock associated with stock awards	789,073
Class A Common Stock [Member] | PRSUs [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Withholding taxes in lieu of share delivery	203,036
Delivery of common stock associated with stock awards	968,045
Class A Common Stock [Member] | 2018 Equity Incentive Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares authorized pertaining to share based compensation arrangements		30,000,000
Class A Common Stock [Member] | Awarded Under 2008 Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of outstanding Class A common stock available under the plan	30.00%
Compensation plan expiration period	Apr. 24, 2018
Class A Common Stock [Member] | 2005 Equity Incentive Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares authorized pertaining to share based compensation arrangements	25,000,000

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Incentive Plans - Summary of Impact of Share-Based Incentive Plans on Compensation and Benefits Expense (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Share-based incentive awards:
Share-based incentive awards	$ 76,402	$ 87,010	$ 161,083	$ 169,830
RSUs [Member]
Share-based incentive awards:
Share-based incentive awards	48,194	55,635	103,391	116,522
PRSUs [Member]
Share-based incentive awards:
Share-based incentive awards	928	17,051	2,249	28,018
Restricted Stock [Member]
Share-based incentive awards:
Share-based incentive awards	8,085	12,600	17,597	23,373
Profits Interest Participation Rights [Member]
Share-based incentive awards:
Share-based incentive awards	17,413		35,881
DSUs [Member]
Share-based incentive awards:
Share-based incentive awards	$ 1,782	$ 1,724	$ 1,965	$ 1,917

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Incentive Plans - Schedule of Activity Relating to RSUs and DSUs (Detail)	6 Months Ended
	Jun. 30, 2019 $ / shares shares
RSUs [Member]
Share-based compensation arrangement by share-based payment award [Line Items]
Units, Beginning Balance | shares	11,362,306
Units, Granted | shares	5,564,865
Units, Forfeited | shares	(368,195)
Units, Settled | shares	(5,795,423)
Units, Ending Balance | shares	10,763,553
Weighted Average Grant Date Fair Value, Beginning Balance | $ / shares	$ 43.78
Weighted Average Grant Date Fair Value, Granted | $ / shares	38.32
Weighted Average Grant Date Fair Value, Forfeited | $ / shares	42.68
Weighted Average Grant Date Fair Value, Settled | $ / shares	37.03
Weighted Average Grant Date Fair Value, Ending Balance | $ / shares	$ 44.63
DSUs [Member]
Share-based compensation arrangement by share-based payment award [Line Items]
Units, Beginning Balance | shares	323,546
Units, Granted | shares	61,449
Units, Ending Balance | shares	384,995
Weighted Average Grant Date Fair Value, Beginning Balance | $ / shares	$ 39.27
Weighted Average Grant Date Fair Value, Granted | $ / shares	31.97
Weighted Average Grant Date Fair Value, Ending Balance | $ / shares	$ 38.10

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Incentive Plans - Schedule of Activity Relating to RSUs and DSUs (Parenthetical) (Detail)	6 Months Ended
	Jun. 30, 2019 shares
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Dividend participation rights	566,194

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Incentive Plans - Summary of Activity Related to Shares of Restricted Class A Common Stock (Detail) - Restricted Stock [Member]	6 Months Ended
	Jun. 30, 2019 $ / shares shares
Share-based compensation arrangement by share-based payment award [Line Items]
Units, Beginning Balance | shares	1,541,058
Units, Granted | shares	1,039,736
Units, Forfeited | shares	(194,097)
Units, Settled | shares	(1,159,850)
Units, Ending Balance | shares	1,226,847
Weighted Average Grant Date Fair Value, Beginning Balance | $ / shares	$ 43.16
Weighted Average Grant Date Fair Value, Granted | $ / shares	35.32
Weighted Average Grant Date Fair Value, Forfeited | $ / shares	41.28
Weighted Average Grant Date Fair Value, Settled | $ / shares	38.37
Weighted Average Grant Date Fair Value, Ending Balance | $ / shares	$ 41.34

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Incentive Plans - Summary of Activity Relating to PRSUs (Detail) - PRSUs [Member]	6 Months Ended
	Jun. 30, 2019 $ / shares shares
Share-based compensation arrangement by share-based payment award [Line Items]
Units, Beginning Balance | shares	1,771,795
Units, Settled | shares	(1,171,081)
Units, Ending Balance | shares	600,714
Weighted Average Grant Date Fair Value, Beginning Balance | $ / shares	$ 38.66
Weighted Average Grant Date Fair Value, Settled | $ / shares	32.44
Weighted Average Grant Date Fair Value, Ending Balance | $ / shares	$ 50.78

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Incentive Plans - Summary of Activity Relating to PIPRs , including PRPUs (Detail) - Profits Interest Participation Rights [Member]	6 Months Ended
	Jun. 30, 2019 $ / shares shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Units, Granted | shares	1,462,702
Units, Ending Balance | shares	1,462,702
Weighted Average Grant Date Fair Value, Granted | $ / shares	$ 38.65
Weighted Average Grant Date Fair Value, Ending Balance | $ / shares	$ 38.65

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Incentive Plans - Summary of LFI and Other Similar Deferred Compensation Arrangements (Detail) $ in Thousands	6 Months Ended
	Jun. 30, 2019 USD ($)
Deferred Compensation Arrangement With Individual Excluding Share Based Payments And Postretirement Benefits [Line Items]
Compensation Liability, Beginning Balance	$ 188,962
Compensation Liability, Ending Balance	235,504
LFI and Other Similar Deferred Compensation Arrangements [Member]
Deferred Compensation Arrangement With Individual Excluding Share Based Payments And Postretirement Benefits [Line Items]
Prepaid Compensation Asset, Beginning Balance	76,362
Prepaid Compensation Asset, Granted	101,340
Prepaid Compensation Asset, Forfeited	(646)
Prepaid Compensation Asset, Amortization	(59,283)
Prepaid Compensation Asset, Other	275
Prepaid Compensation Asset, Ending Balance	118,048
Compensation Liability, Beginning Balance	188,022
Compensation Liability, Granted	101,340
Compensation Liability, Settled	(82,990)
Compensation Liability, Forfeited	(983)
Compensation Liability, Increase (decrease) in fair value of underlying investments	20,354
Compensation Liability, Adjustment for estimated forfeitures	3,198
Compensation Liability, Other	495
Compensation Liability, Ending Balance	$ 229,436

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Incentive Plans - Summary of Impact of LFI and Other Similar Deferred Compensation Arrangements (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Share Based Compensation [Abstract]
Amortization, net of forfeitures	$ 44,210	$ 36,293	$ 62,144	$ 52,129
Change in the fair value of underlying investments	6,484	(499)	20,354	(1,935)
Total	$ 50,694	$ 35,794	$ 82,498	$ 50,194

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Employee Benefit Plans - Components of Net Periodic Benefit Cost (Credit) (Detail) - Pension Plans [Member] - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Components of Net Periodic Benefit Cost (Credit):
Service cost	$ 205	$ 223	$ 412	$ 453
Interest cost	3,858	3,977	7,760	8,039
Expected return on plan assets	(6,873)	(7,583)	(13,899)	(15,366)
Amortization of:
Prior service cost	27		56
Net actuarial loss (gain)	1,260	1,245	2,541	2,523
Settlement loss	1,739		3,522
Net periodic benefit cost (credit)	$ 216	$ (2,138)	$ 392	$ (4,351)

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Income Taxes - Additional Information (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Income Tax Disclosure [Abstract]
Income tax provisions	$ 28,172	$ 51,561	$ 51,359	$ 75,728
Effective income tax rates	27.70%	25.80%	23.20%	19.60%
U.S. federal statutory income tax rate	21.00%		21.00%

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Net Income Per Share of Class A Common Stock - Company's Basic and Diluted Net Income Per Share and Weighted Average Shares Outstanding (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Earnings Per Share [Abstract]
Net income attributable to Lazard Ltd	$ 65,777	$ 146,963	$ 162,819	$ 306,655
Add - adjustment for earnings attributable to participating securities	(1,604)	0	(1,604)	0
Net income attributable to Lazard Ltd - basic	64,173	146,963	161,215	306,655
Add - adjustment for earnings attributable to participating securities	5	0	5	0
Net income attributable to Lazard Ltd - diluted	$ 64,178	$ 146,963	$ 161,220	$ 306,655
Weighted average number of shares of Class A common stock outstanding	110,076,582	120,049,627	110,847,112	119,872,688
Add - adjustment for shares of Class A common stock issuable on a non-contingent basis	1,904,622	256,630	1,115,617	245,494
Weighted average number of shares of Class A common stock outstanding - basic	111,981,204	120,306,257	111,962,729	120,118,182
Weighted average number of incremental shares of Class A common stock issuable from share-based incentive compensation	4,194,145	9,942,797	6,534,988	11,077,543
Weighted average number of shares of Class A common stock outstanding - diluted	116,175,349	130,249,054	118,497,717	131,195,725
Net income attributable to Lazard Ltd per share of Class A common stock:
Basic	$ 0.57	$ 1.22	$ 1.44	$ 2.55
Diluted	$ 0.55	$ 1.13	$ 1.36	$ 2.34

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Related Parties - Additional Information (Detail) - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
	Oct. 26, 2015	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018	Dec. 31, 2018
Related Party Transaction [Line Items]
Fees receivable		$ 502,846		$ 502,846		$ 501,397
Payments under tax receivable agreement				23,687	$ 31,897
Investment Banking and Other Advisory Fees [Member]
Related Party Transaction [Line Items]
Revenue		328,974	$ 421,444	664,778	830,170
Investment Banking and Other Advisory Fees [Member] | Member of Board of Directors and Chairman/CEO of Company that Services were Provided to [Member]
Related Party Transaction [Line Items]
Revenue				3,000
Sponsored Funds [Member]
Related Party Transaction [Line Items]
Revenue		$ 153,198	$ 170,680	$ 297,368	$ 351,990
Type of Revenue [Extensible List]		us-gaap:AssetManagement1Member	us-gaap:AssetManagement1Member	us-gaap:AssetManagement1Member	us-gaap:AssetManagement1Member
Fees receivable		$ 56,696		$ 56,696		59,304
LTBP Trust [Member]
Related Party Transaction [Line Items]
Amount of cash savings in income or franchise tax that would be realized as a result of increases in tax basis and certain other tax benefits related to the amended and restated tax receivable agreement	45.00%
Cash tax saving that may arise from tax benefits attributable to payments under the amended and restated tax receivable agreement	85.00%
Cumulative liability relating to obligations under Amended and Restated Tax Receivable Agreement		$ 246,953		246,953		$ 270,640
Payments under tax receivable agreement				$ 23,687

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Regulatory Authorities - Additional Information (Detail) - USD ($)	Jun. 30, 2019	Mar. 31, 2019
LFNY [Member]
Regulatory Requirements [Line Items]
Specified fixed percentage, minimum required capital	6.67%
Minimum net capital requirement as defined under exchange act	$ 100,000
Regulatory capital	90,760,000
Regulatory capital in excess of minimum requirement	$ 87,343,000
Aggregate indebtedness to net capital ratio	0.56
LFNY [Member] | Maximum [Member]
Regulatory Requirements [Line Items]
Aggregate indebtedness to net capital ratio	15
U.K. Subsidiaries [Member]
Regulatory Requirements [Line Items]
Regulatory capital	$ 167,610,000
Regulatory capital in excess of minimum requirement	151,085,000
CFLF [Member]
Regulatory Requirements [Line Items]
Regulatory capital	168,669,000
Regulatory capital in excess of minimum requirement	111,947,000
Combined European Regulated Group [Member]
Regulatory Requirements [Line Items]
Regulatory capital		$ 157,090,000
Regulatory capital in excess of minimum requirement		$ 53,516,000
Other U.S. and Non-U.S. Subsidiaries [Member]
Regulatory Requirements [Line Items]
Regulatory capital	163,269,000
Regulatory capital in excess of minimum requirement	$ 135,064,000

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Segment Information - Segment's Contribution with Respect to Net Revenue, Operating Expenses, Operating Income (Loss) and Total Assets (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018	Dec. 31, 2018
Segment Reporting Information [Line Items]
Net Revenue	$ 630,690	$ 757,938	$ 1,274,364	$ 1,512,636
Operating Expenses	529,005	557,998	1,053,016	1,126,868
Operating Income (Loss)	101,685	199,940	221,348	385,768
Total Assets	5,507,473		5,507,473		$ 4,997,241
Operating Segments [Member] | Financial Advisory Segment [Member]
Segment Reporting Information [Line Items]
Net Revenue	329,612	422,089	667,982	831,210
Operating Expenses	276,238	318,177	556,499	642,873
Operating Income (Loss)	53,374	103,912	111,483	188,337
Total Assets	981,571		981,571		859,306
Operating Segments [Member] | Asset Management Segment [Member]
Segment Reporting Information [Line Items]
Net Revenue	315,591	352,588	617,424	706,871
Operating Expenses	219,021	229,561	426,369	459,230
Operating Income (Loss)	96,570	123,027	191,055	247,641
Total Assets	702,530		702,530		728,220
Corporate [Member]
Segment Reporting Information [Line Items]
Net Revenue	(14,513)	(16,739)	(11,042)	(25,445)
Operating Expenses	33,746	10,260	70,148	24,765
Operating Income (Loss)	(48,259)	$ (26,999)	(81,190)	$ (50,210)
Total Assets	$ 3,823,372		$ 3,823,372		$ 3,409,715

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Consolidated VIEs - Summary of Consolidated VIE Assets and Liabilities (Detail) - USD ($) $ in Thousands	Jun. 30, 2019	Dec. 31, 2018
ASSETS
Cash and cash equivalents	$ 919,221	$ 1,246,537
Customers and other receivables	202,268	184,137
Investments	575,424	575,148
Other assets	319,033	258,634
LIABILITIES
Deposits and other customer payables	1,480,684	1,154,207
Other liabilities	494,150	$ 576,986
Variable Interest Entity, Primary Beneficiary [Member]
ASSETS
Cash and cash equivalents	4,543
Customers and other receivables	353
Investments	89,762
Other assets	572
Total Assets	95,230
LIABILITIES
Deposits and other customer payables	1,033
Other liabilities	286
Total Liabilities	$ 1,319

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Consolidated VIEs - Summary of Consolidated VIE Assets and Liabilities (Parenthetical) (Detail) - USD ($) $ in Thousands	Jun. 30, 2019	Dec. 31, 2018
Variable Interest Entity [Line Items]
Investments	$ 575,424	$ 575,148
Lazard Fund Interests [Member] | Lazard Group LLC [Member]
Variable Interest Entity [Line Items]
Investments	$ 81,999