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Bonus Watch '13: It Could Be Worse

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You could be getting paid (or not paid) by Europe.

Or Morgan Stanley.

European firms appear to be holding back, or deferring, substantially more of their top risk-takers’ pay than American banks. European banks like Barclays and Credit Suisse are deferring as much as 70 percent of the compensation granted to top employees, according to an analysis by The New York Times of the banks’ annual reports. American firms, by contrast, generally appear to be deferring about half...Last year, the investment banking divisions of Credit Suisse and Barclays, which compete on Wall Street, deferred 72 percent of the total compensation earned by risk-taking employees, according to figures in their annual reports. Deutsche Bank deferred 57 percent in its investment bank last year...Filings for 2011, the most recent available, show that only 40 percent of compensation was deferred for employees at Citigroup’s global markets operations in London. The figure was 43 percent for Morgan Stanley’s London operations and 44 percent for JPMorgan’s. Bank of America deferred 49 percent of London employees’ pay. Barclays, in contrast, deferred 70 percent of its regulated employees’ compensation across the whole firm in 2011. Credit Suisse deferred 60 percent.

In 2012, Morgan Stanley appeared to be an outlier among American firms. Most of the bonuses for top employees, excluding financial advisers, were deferred. Specifically, if total compensation was over $350,000, and the bonus was over $50,000, the entire bonus was delivered over three years. Mark Lake, a spokesman for the bank, declined to say whether that approach would be used for future years’ compensation.

Bankers’ Pay Deferrals Are Tougher in Europe [Dealbook]


Bonus Watch '13: Jefferies CEOs

Dick Handler ended up doing pretty okay for himself.

Bonus Watch '13: UBS

Not everyone received a package that resulted in a nice long cry. Andrea Orcel, for example, did pretty okay for himself.

Layoffs/Bonus Watch '12/13: Morgan Stanley

Back in January, Morgan Stanley CEO James Gorman sent a simple messages to his employees, who had been grumbling about their pay: STFU or GTFO. "You're naive, read the newspaper, No.1," Gorman told Bloomberg he would say to any members of his staff that wanted to give him lip about their compensation to his face. "No. 2, if you put your compensation in a one-year context to define your over all level of happiness, you have a problem which is much bigger than this job. And No. 3, if you're really unhappy, just leave." Today, in an interview with the FT, Gorman reiterated his stance and added that in addition to reducing compensation for current employees, the bank will likely be drastically cutting pay for future analysts. If anyone has a problem with that, consider applying for a gig at Bank of Mythical Pre-Crisis Era Bonuses. Alternatively, Gorman is happy to discuss a compensation plan in which you'll be awarded shares of his foot in your ass, which vest immediately. In the latest sign of the pressure Wall Street is under to cut costs and address high pay levels, James Gorman, chief executive, said that staff and remuneration would have to be sacrificed as banks cope with lower profits. “There’s way too much capacity and compensation is way too high,” Mr Gorman said in an interview with the Financial Times. “As a shareholder I’m sort of sympathetic to the shareholder view that the industry is still overpaid.” Morgan Stanley itself is already axing 4,000 jobs, 7 per cent of its workforce, by the end of this year. In the new year, Mr Gorman said, the bank will consider its next round of cost-cutting, including lower pay and bonuses. News of further pay cuts, including potentially for new entrants at the investment bank, comes just weeks after Goldman Sachs confirmed it was overhauling its well-known entry-level programme for analysts. Goldman was said to have tired of the number of analysts in the programme who left the bank for hedge funds. Mr Gorman said that Morgan Stanley will probably keep its own analyst programme, but pay could be reduced significantly. Morgan Stanley Chief Warns On Wall Street Pay [FT] Earlier: James Gorman To Employees: STFU Or GTFO