Credit Suisse’s bonuses were announced internally last week, but information is only just starting to emerge about the Swiss bank’s bonus structure.
Headhunters and Credit Suisse insiders say the bank will be deferring an element of all compensation above CHF250k. In other words, cash compensation is capped at this level and once an individual’s combined salary and bonus exceed CHF250k, a proportion will be deferred. We understand that the proportion deferred will vary with the level of pay, with deferrals starting at 15% of bonuses.
Credit Suisse declined to comment.
The Swiss bank’s cap on cash compensation looks a lot lower than rivals’. It emerged last week that Deutsche Bank is capping cash bonuses at €300k ($409k). Investment bankers at Deutsche will be able to receive their salaries, plus a cash bonus of €300k before any of their pay is deferred. Some Deutsche Bankers could earn €600k (CHF742k) cash as a result.
By comparison, deferrals will kick on at Credit Suisse once an individual earns anything over CHF250k. Morgan Stanley has a similar cap on the amount of cash it pays in total compensation, but it is set at $350k (CHF318k) and is therefore 27% higher than at Credit Suisse.
Credit Suisse’s CHF250k cap on cash compensation looks similar to last year. The bank raised the level of its cash cap significantly for 2011 bonuses after it was set at just CHF50k for 2010 bonuses, prompting junior Credit Suisse bankers to bitterly complain.
As has already been reported, Credit Suisse is continuing its policy of clawing back cash bonuses this year: anyone who leaves within three years will have to pay back a proportion of the bonus they received in cash.