Remember, back in December 2008, when Credit Suisse announced it would be paying out bonuses comprised of toxic assets? And Brady Dougan was staring at the business end of a hissy fit from many a miffed employee, who thought good and hard about threatening to leave before realizing it was cold out there? Apparently things turned out pretty okay for them.
The toxic-asset bonuses given to senior Credit Suisse Group AG bankers at the depths of the 2008 financial crisis are turning out to be almost as good as gold. Credit Suisse employees who got $5.05 billion of junk-grade loans and commercial-mortgage-backed bonds in late 2008 as part of annual bonuses have reaped gains of 75 percent on the payouts since the end of that year through Nov. 30, people with knowledge of the results said. Gold futures returned 98 percent in the period, while Credit Suisse’s shares declined 23 percent. The gains, which also beat the 4.8 percent return of two- year Treasuries, show how the rebound in debt markets from the lows of 2008 has sweetened the Zurich-based bank’s executive bonuses compared with the cash and stock bonuses rivals paid.
“It worked out in favor of the employees,” said Ann Rutledge, a former Moody’s Investors Service analyst who’s now a principal at R&R Consulting in New York, which rates mortgage bonds and other asset-backed securities. Looking back, “market valuations would have been at all-time lows” when the internal asset pool was set up.
You’re welcome.
Credit Suisse Toxic Bonuses Provide 75% Returns [Bloomberg]
This year we're paying bonuses in beanie babies, Pokemon cards and Credit Suisse equity. They'll all be worth something again someday…
-B. Dougan
75% vs Nil if it would have been equity….way to go Lego head.
yes, yes, no
that must a real morale booster for CS CEO — employees prefering junk bonds in height of credit crisis over own bank equity…
Worthless stuff in 2008 is up 75%? We're rich!
- all the ex-Lehman Quants
actually was lot of pushback from employees. ended up working out for them in the end.
JPM employees were allocated stock at $18 a share that year…. where is it trading now? Pffft
Proof that daddy knows best.
Valuation of the toxic assets was completed by CS frist year analysts, who were told they'd be let go upon completing the task.
Having Ajit Jain place low ball value on the assets going into your bonus pool, is the NKI.
-AIG Whistleblower Quant
When did Harvey Dent start working for CS?
He looks like the leprechaun that tells me to burn things.
- R. Wiggum
they should be thanking the traders who were fired for getting those "toxic" securities on books in the first place…other than that, I have no concerns.
-J. C. Blaine
that sounds amazing, tell us more.
~WGAF Capital
For some reason, this has me thinking of a porn scene.
BAC shares from Merrill Lynch bonuses that year priced at $14.33. compounded annually we're only 2 years away from the ROI on LEH's 2007 stock awards.
Not sure why this is getting all the thumbs down considering it's, y'know, entirely true. Also, re HFguy's comment, no one was giving their "preference" on what they wanted- it was toxic assets or it was nothing. FYI.
Mitt has been gunning for POTUS for probably 30 years, yet still has the balls to park $100mm in the Caymans. Another one of Harvard's finest..
So I should continue to let him tuck me in naked at night?
So you buy up your own crap when prices are at their lowest?
- Bear Stearns Hitter
Now we know where all the MBS's they bought this week went to… CS employees!
There is nothing wierd here. I'm your uncle.
-J. Sandusky
Everything is coming up banker, bitches.
Around the same time as Michael J Fox, pictured.
Except that CS paid values for them which were multiples of the ones they gave them away on.
Other than that, yeah, sure.
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