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Bonuses, deferrals and vesting – bank by bank

As news on 2010 bonuses seeps out, both from banks and headhunters, we’ve amalgamated what’s currently known into one place for you. Here it is.


Barclays Capital

Comp per head, 2010:

229k.

This is up 20% on last year.

Percentage in cash, percentage deferred

The total BarCap bonus pool for 2010 was 2.6bn (apparently down from 2.9bn in 2009). 34% of the total bonus pool, across the group, was deferred.

Vesting schedule

MDs and anyone with compensation in excess of 1m are said to be getting 40% in cash now, 30% in shares deferred over three years and 30% in a contingent capital plan which is also deferred over three years and which will only vest if the tier one capital ratio remains above 7%.

Pay for executives

Bob Diamond is said to be receiving a bonus of 9.5m

Other things of note

There are clawbacks for BarCap MDs if the tier one capital ratio falls below 7%.

On the whole, bonuses are said to be down 10-15% and people are, “fairly happy.”


Bank of America Global Banking and Markets

Comp per head, 2010:

Not broken out.

Percentage in cash, percentage deferred

Much is being made of the fact that BAML is deferring less than last year. At senior levels, Bloomberg reports 20-30% of bonuses are now in cash, compared to just 5% last year.

Further down the ranks, however, headhunters tell us deferrals are nowhere near as punitive. One London corporate finance headhunter says junior staff are getting just 20-25% deferred and that some MDs are receiving 60% of their bonuses in cash.

Vesting schedule

Three years.

Pay for executives

As we note here, Tom Montag is the big winner. Brian Moynihan is getting $9.1m in restricted stock, but only according to a strange formula requiring that the bank’s profits remain above 0.80 per cent of its assets from 2011 to 2015.

Other things of note

The investment banking division apparently reduced overall compensation by 10% last year; managing directors in areas that underperformed allegedly had their pay cut by 20%.

Base salaries for VPs in corporate finance are said to be under review.

Citigroup Investment Bank

Comp per head, 2010:

Not broken out.

Percentage in cash, percentage deferred

Everything we’re hearing from headhunters suggests Citigroup has been very generous with cash. Allegedly, 60-70% of its front office bonuses in London this year are cash-based, even for high earners.

CNBC said Citigroup’s paying ‘up to 65%’ of its bonuses in cash.

However, Bloomberg says Citi’s paying more shares and that the share portion of bonuses has risen from 40-50% this year. However, this is repudiated by headhunters in London.

Vesting schedule

Four years

Pay for executives

Vikram Pandit’s salary has been increased from $1 to $1.75m. The bank hasn’t disclosed the rest of his compensation.

Separately, Citigroup will be sharing $12m between four of its top executives over the next four years if the bank’s core operations make profits of $12bn. This is not expected to be particularly onerous, given that the same divisions made $15bn in 2010.

Other things of note


Credit Suisse Investment Bank

Comp per head, 2010:

CHF388k ($410k).

This was down 15% on 2009.

Percentage in cash, percentage deferred

Credit Suisse has a new compensation policy year.

This states that: at least 35% of all payments above 33k will be deferred and that the maximum deferred amount will be 70%.

Headhunters in London report disgruntlement at the Swiss bank, with traders are VP level reportedly getting 70% deferrals, and 65% deferrals being very common.

Vesting schedule

Four years

Pay for executives

Not available yet. Last year, Brady Dougan got CHF19.2m in cash and stock for 2009, plus CHF70m in stock from a bonus plan dating back to
2004.

Other things of note

Credit Suisse wants to be able to claw back the cash element of MDs’ bonuses if they leave within two years. However, headhunters say there are problems implementing this because it will require existing staff to sign new contracts.

Separately, the deferred element of CS bonuses takes the form of ‘Adjustable Performance Plan Awards.’ These are adjusted upwards based on Credit Suisse’s cumulative ROE over the four year period, and could prove valuable. However, APPAs will be adjusted downwards if the division an individual works for makes a loss.


Deutsche Bank Corporate and Investment Bank

Comp per head, 2010:

€355k ($485k) in the corporate and investment bank (deducting costs for severance payments).

This was up around 2% on 2009.

Percentage in cash, percentage deferred

Around 40% is said to be deferred for mid-ranking staff, with senior people typically getting 60% deferrals and some people receiving cash components of as little as 25%.

Vesting schedule

Three years.

Other things of note

Deferred cash is said to earn an interest rate of 5%.


Goldman Sachs

Comp per head, 2010:

$418k.

Percentage in cash, percentage deferred

Headhunters in London claim that Goldman is being generous with cash. Non-MD non-code staff are reportedly receiving just 20% in stock.

Vesting schedule

Three years.

Pay for executives

As we noted yesterday, Goldman’s partners and executives have had generous pay hikes. Michael Sherwood is getting $14.4m of restricted stock for 2010, up 60% on 2009. Lloyd Blankfein’s salary has tripled to $2m. Lloyd also received $12.6m in stock.

Other things of note

Headhunters in London say people at Goldman are happy with their lot. This even applies to people in the back office.


HSBC Global Banking and Markets

Comp per head, 2010:

Not officially disclosed, but thought to be around 156k ($253k) in HSBC Global Banking and Markets. This is based on a bonus pot which has been announced at 1.24bn, and which is assumed to be around 45% of total compensation. It also assumes that HSBC still employs around 21,000 people in Global Banking and Markets.

Pay for executives

Stuart Gulliver is expected to receive a 9m bonus.


JPMorgan Investment Bank

Comp per head, 2010:

$349k

This was an 8% fall on last year.

Percentage in cash, percentage deferred

JPMorgan hasn’t commented on its deferral policy. However, headhunters in London say it’s paying 65% in cash at MD level and 75% cash at VP level.

Vesting schedule

JPMorgan’s said to have got an unusual deferral. Effectively, the vesting period is three years, however nothing vests in year 1, with 50% available in years two and three.

Pay for executives

The stock payout to JPMorgan’s operating committee rose 14% for 2010 vs 2009. Jes Staley, CEO of the investment bank, received $8m in restricted shares and 230,770 stock options. Jamie Dimon got a 22% increase in his restricted stock allocation, to around $17m.

Other things of note

London bankers at JPMorgan are said to be peeved. The bank’s performed well relative to its peers and they were expecting more.


Morgan Stanley

Comp per head, 2010:

Not broken out for the investment bank alone.

Percentage in cash, percentage deferred

Like Credit Suisse, Morgan Stanley’s said to have particularly punitive deferrals. The bank has let it be known that it’s deferring 60% of its bonuses globally and 80% for its most senior staff.

Headhunters in London say a lot of people are only getting 25% of their bonuses in cash upfront.

Vesting schedule

Morgan Stanley appears to have an unusual deferral schedule. Only 20% of what’s deferred is allegedly stock – with the remainder paid as deferred cash. The stock element is apparently deferred over four years. The cash element is apparently deferred over 18 months, paid in tranches in July 2011, December 2011 and July 2012.

Other things of note

Morgan Stanley is rumoured not to have paid its back and middle office people particularly well.


RBS Global Banking and Markets

Comp per head, 2010:

Not available yet, but the bonus pool has fallen 27% to950m.

Percentage in cash, percentage deferred

In April, people at RBS Global Banking and Markets will receive only 2k of their bonuses in cash.

Vesting schedule

Having received a mere 2k in April 2011, a third of the remaining bonus is expected to be made available in June 2011.

Pay for executives

Stephen Hester is getting a 2m bonus, in shares, which he will not be able to access for three years.

Other things of note

The government has repeatedly called for RBS to be a ‘backmarker.’


UBS Investment Bank

Comp per head, 2010:

CHF400k in the investment bank ($423k).

This is up 13% on last year.

Percentage in cash, percentage deferred

In total, 62% of the bonus pool is being paid in cash; only 36% is deferred. Across the bank, vesting of previous year’s bonuses is expected to be almost equal to the amount deferred this year.

Deferrals are said to be higher than at some US banks, with around 50% deferred for director-level staff and with senior associate directors (senior associates at other banks) getting 30% deferred.

Dealbreaker claims that everyone earning more than CHF250k will get 60% of their bonus deferred.

Vesting schedule

Three years.

Other things of note

UBS pay is said to be ‘barbell’ shaped, with high performing senior staff and newly recruited juniors being well-rewarded while the rest get very little at all.

Comments (5)

Comments
  1. can we have bonuses by function and title?
    thanks

  2. Deutsche – rubbish this year, except for an elite few. Back office non-existent..

  3. can we have bonuses by function and title as per request from douche? Also, do you have a breakdown as per last year on salaries per title, per major player?

  4. @Douche, confuseled and HB – much as it would be very nice to have bonuses by function and title, at all the banks above, this is not (immediately) possible. Unfortunately, banks don’t publish information with this kind of granularity and extracting it from recruitment firms will be necessarily susceptible to distortions and fabrications.

    This doesn’t mean we won’t try, but it may take some time.

    In the meantime, here’s a list of salaries, bank by bank, level by level. http://news.efinancialcareers.co.uk/News_ITEM/newsItemId-29986

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