Nomura's bonuses are bad, but better than expected

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Nomura's bonuses are bad, but better than expected

Yesterday was Nomura's bonus day. After all that's happened at the Japanese bank in the past six weeks (layoffs, tears, regrets), it might be supposed that 2019 bonuses at Nomura would be scrapped in the style of Deutsche Bank 2017. But this hasn't happened. Nomura is paying bonuses - just not very big ones. 

Nomura insiders say the bank has rewarded a handful of its favourite traders with bonuses that are flat on last year. Merely exceptional-to- good performers got bonuses that were down 30% to 80%. Nomura people who underperformed were paid no bonuses at all. Bonuses have also been calibrated to reflect the likelihood that staff will be able to find jobs elsewhere. In global markets, salespeople seem to have been punished most severely.

As Nomura tries to save $1bn in costs, not-so-great bonuses were an inevitability at the Japanese bank this year. Nomura's senior managing directors had already been instructed to forego bonuses in their entirety. - The fear was that most other people would suffer a similar fate.

Although this fear hasn't been realised, Nomura insiders say there's still a risk that disgruntled staff will leave. James Kalbermatter already joined Natwest Markets and Idriss Amor is understood to be arriving at a major U.S. bank in London soon.   

Insiders complain of poor leadership and uncertainty of ever being paid well again. "People who've outperformed are flight risks," says one Nomura trader. He adds that Nomura has promoted many of those whose bonuses were disappointing to help palliate the poor pay. "This will make it more difficult for them to move  - the more senior you are, the fewer opportunities are available," he says.

"I thought I was supposed to be a star," says another Nomura markets professional. "I had an amazing year and I'm down hugely. They haven't taken care of us at all."

Nomura has a reputation for paying well in London, particularly at the senior end. Three years ago, it became apparent that a former executive director in rates sales at Nomura in London, was on a total package (salary plus bonus) of £310k. 

Nomura declined to comment.

In the investment banking division, Nomura's bonuses may have been better. "Let's just say, my bonus was bad but it wasn't zero," says one banker. Another scored his bonus at eight out of ten. 

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