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Bonus Watch '14: Citigroup

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Everyone at the House of Corbat is being asked to make sacrifices for the team this year, though some more than others.

The year-end bonus pool for the bank’s trading business will be unchanged from 2013, according to a person briefed on the matter, even though revenue has been sliding. The investment-banking division will increase rewards by 2 percent to 3 percent, short of its jump in revenue, the person said. Some bankers may see increases of as much as 5 percent, said the person, who asked not to be identified because the information hasn’t been disclosed publicly. Some traders may yet see cuts as payouts vary among desks focusing on different products, said another person. Investment-banking revenue rose 11 percent during the first nine months of 2014, while trading revenue slumped 9 percent, compared with a year earlier. Robert Julavits, a bank spokesman, declined to comment. Chief Executive Officer Michael Corbat, 54, is under pressure to limit compensation costs as he heads into next year, when he must show investors the bank can meet efficiency goals. For employees, that means continued restraint: A year ago, payouts for Citigroup’s bankers were said to be little changed, while traders and salespeople got cuts of 2 percent.

Citigroup Said to Keep Trading Bonus Pool Flat Amid Revenue Drop [Bloomberg]


Bonus Watch '12: Retired Citigroup CEOs

Uncle Vik may or may not be getting a little something extra in his stocking, depending on how generous Citi is feeling. Vikram Pandit, who stepped down yesterday as Citigroup’s chief executive officer, stands to forfeit almost $33 million in cash and stock from a retention package unless the board gives him a payout to ease his exit. Citigroup formulated a plan last year that, based on the firm’s performance so far, would have given Pandit $19 million through a profit-sharing agreement, deferred stock now valued at $9 million and $4.6 million in options, according to the terms of a May 2011 regulatory filing and data compiled by Bloomberg. The plan required Pandit, 55, to be employed at the bank through various payment dates, most of which haven’t been reached. It’s typical for CEOs who resign to forfeit previously negotiated severance and to work out an alternative payout agreement with the board, said Steven Hall, managing director of Steven Hall & Partners, a New York-based executive compensation consulting firm. Pandit getting nothing would signal that “he stood up and said, ‘I’m resigning,’” Hall said. If he gets a payout, “then the question is, did they give him that in order to smooth the path to his resignation or termination? Or did they look at him and say, ‘You know what, you did a hell of a good job during a very, very rough time, we’d like to do something nice for you,’” Hall said. Pandit Could Forgo $33 Million as Exit Voids Retention Plan [Bloomberg]

Bonus Watch '12: Ex-Citigroup CEOs

Just because they unceremoniously threw him out on his ass doesn't mean the board wants to see Vikram go home empty handed. Vikram Pandit, Citigroup' ousted chief executive officer, will get about $6.7 million in 2012 compensation and will forfeit some awards tied to a $40 million retention package granted last year. John Havens, who resigned last month as Citigroup’s chief operating officer on the same day as Pandit, will get about $6.8 million for 2012 and also forfeit some awards, the New York-based lender said today in a regulatory filing. Citigroup is the third-largest U.S. bank by assets. “Based on the progress this year through the date of separation, the board determined that an incentive award for their work in 2012 was appropriate and equitable,” Chairman Michael E. O’Neill said in the filing. “While Citi will also honor all past awards that they are legally entitled to, there are no severance payments. Awards to which they are not legally entitled have been forfeited.” Citigroup's Pandit $6.7 Million Compensation For 2012 [Bloomberg]