I’ve been thinking a lot about financial industry compensation recently, and probably so have you, for different reasons. As a non-recipient of said compensation, I’ve been waxing philosophical about how your bonus can incentivize you either to put on low-risk trades that are unlikely to blow up your firm or to go instead with high-risk overlevered bets that look good in December but will leave the place a smoking ruin in March, by which point you’ll be out of there with your pile of bonus CLOs. But if you don’t take kindly to other people telling you what to do / “incentivizing” you to do it, there’s always the do-it-yourself bonus, either in the traditional form (write checks to self) or in the slightly more complicated form of writing down the amount of money that you would like your trades to make, then getting a bonus based on the number you wrote down: Continue reading »
Credit Suisse
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Credit Suisse Traders Made The Unusual Mistake Of Committing CDO Fraud On Themselves
By Matt LevineThe cuts won’t go down until the spring, so just something to keep in mind. Continue reading »
“People are furious.” Continue reading »
A couple weeks back, a report circulated that Wall Street banks were considering freezing compensation for junior employees. The firms were hesitating, however, supposedly on account of the backlash they feared would occur from failing to keep “potential future stars…engaged and happy.” Yes, they were terrified at the consequences of how their junior mistmakers would react to the news and didn’t want to pull the trigger unless everyone promised to do the same, preventing a dire situation wherein a handful of first and second year analysts quit to join firms where their unique talents would be appreciated. Credit Suisse CEO Brady Dougan, for one, has decided not to be afraid anymore. Continue reading »
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. Continue reading »
Report: Trembling In Fear, Wall Street Banks Want To Make Sure They’ve Got Each Others’ Backs Before Invoking The Wrath Of 22 Year-Old Junior Mistmakers
By Bess LevinAs you may have heard, bonus season this year is going to be a bit tricky, on account of the fact that Wall Street banks didn’t make much in the way of cash in 2011. While paying some seniors staff zero dollars is being considered, it still may not be enough to pick up the slack. There is one idea that’s been floated among firms but shot down, so far, for fear of being too risky, so risky that it’s probably not even safe to mention it here but I’m gonna– freezing pay for junior staff. (Oh god, shhh, don’t say it aloud, we don’t want to start a run on the banks!) Everyone wants to do it but no one’s got the cojones, fearing the backlash that would come from angering “future stars” whose names will be learned in 5-7 years when they graduate from second class citizen status. No, the consequences would be dire. Unless…unless everyone put up a united front against these incredibly powerful and intimidating people? Continue reading »
Speculation has been going around that some employees will be receiving a whole lot of nothing. Continue reading »
Cuts have gone down at the House of Dougan. Continue reading »
The good news: bank bonuses are going to be down by a lot this year, upwards of 40 percent down. If you are on the receiving end of one of these slimmed-down packages, congratulations! It (probably) means management really likes you, as evidenced by letting you keep your job,** unlike your colleagues who were replaced by some low-cost business student pre-schoolers or potted plants. Continue reading »
The Swiss bank sent a handful of employees to a farm upstate earlier today. Continue reading »
During bonus season last year, Credit Suisse announced that the money employees earned in 2010 would be paid out over 2011, 2012, 2013 and 2014 (all of which was subject to clawback rules). People were not thrilled! This year, in an effort to show they’ve been listening, management has announced some big changes to the compensation plan. 1) Only those making more than 250,000 Swiss francs (which CS points out are few and far between) will be subject to deferred compensation (previously it was any amount above 50,000) and 2) Of the deferred shares being awarded, you’ll only have to wait three years, and not four, for it to vest. Pretty sweet deal if you ask the other Swiss bank in town, where bonuses (a sheet of bubble wrap and 15 free minutes to cry publicly without judgement) paid out over any period of time would be a step up. The suggestion box is working! Continue reading »
