Citi Asks Permission To Pay Bonuses (WSJ)
The combination of pay caps and the full-sub role Citi has started to play is going to start pushing people towards the door; now that there are stable banks (and we can tell where they are) you’re going to see the decent groups seek to relocate. From a human capital perspective, Citi will start looking like the Treas before too long. Unless it can…pay bonuses (says Citi).
“Citigroup Inc., soon to be one-third owned by the U.S. government, is asking the Treasury for permission to pay special bonuses to many key employees, according to people familiar with the matter.
The request comes as Citigroup is grappling with broad government pay restrictions that could break apart its legendary energy-trading unit. People at that unit, Phibro, are threatening to leave because of pay caps tied to the U.S. bailout of Citigroup. Phibro has been the source of hundreds of millions of dollars in profits for the bank, and has paid out hefty compensation, including a roughly $100 million windfall last year for the unit’s leader, Andrew Hall.”
BP’s Quarterly Earnings Here;Shell’s Here (BBC/WSJ)
Both BP and Shell saw net profit drop by 62% in the most recent quarter, the obvious culprit being the price of oil.
Fed Seeks Capital For Six Banks (Bloomberg)
Obviously Citi and Bank of America, and MS thinks Regions, Sun Trust, and KeyCorp are solid contenders. And lucky number 6 is?
AIG Begs Executive To Reconsider Resignation To Avoid Default (FT)
“AIG has moved to stave off the risk of default on $234bn of derivatives by persuading a senior executive at its troubled financial products division to rescind his resignation and remain with the stricken insurer to unwind the complex trades.
AIG insiders said James Shephard, the deputy chief executive of Paris-based Banque AIG, had decided to stay on as the unit’s chief less than a month after resigning in the midst of the political furor over the insurer’s bonuses.”
Societe General Chairman Steps Down (WSJ)
“After facing repeated attacks, Societe GeneraleSA Chairman Daniel Bouton said Wednesday he will step down, ending more than 10 years at the helm of the French bank that was shaken by a €4.9 billion ($6.44 billion) trading scandal in 2008.”
— Advertisement —
Comments (10)
Leave a comment
You can log in with your account or comment as a guest below.
- Use the Bloomberg command
NH BLG_DEALBREAKER <GO>
to access Dealbreaker
Here’s the thing Timmy. We can’t pay our debt; we’re pretty much insolvent. Hell, we can’t pass the lob of a pitch you called the “stress” test, BUT…we kind of need to pay some HUGE special bonuses…we good, thanks. Honestly, if the traders have the opportunity to go to other banks (probably healthier banks), get the same, if not a bigger paycheck than what citi gave them, and not have to deal with all the citi/government BS, why would you even want to deal with Citi anymore?
http://www.bankonbanking.com
http://www.redneckbank.com/
-the new killin’ it! good rates on deposits too!
the bs never ends
nice GDP numbers
@2
Its the bad bank scenario. Just not completely realized as of yet.
GMAC
Wells
In re: Fed seeks capital? PNC
I would say Wells and every single regional bank in Florida
I am as capitalist as they come – and I have to say to Citi – tough Sh. You can not afford to pay your energy trading bankers, and if they want to leave, then such is life. Their loyalty is obviously not to the firm. If you “need” money from the government, then you can not go around paying people $100million bonuses. If it were upto me these banks would be nationalised, their businesses wound down without chaos, and their remaining assets sold off. That’s how bankruptcy works – regardless of any so called ‘systematic’ risk. Sure people may lose faith in their insurer – but it’ll also ensure in the future insurers stick to what they do and not turn themselves into large hedge funds a la AIG.