French bank Société Générale has announced its bonuses, and people in its fixed income, currencies and commodities (FICC) business are in a state of shock.
Bloomberg flagged SocGen's intention of cutting traders' bonuses by 25% in January. However, insiders said the cuts appear to have been considerably higher than this, with even top performing people in fixed income at the bank seeing their bonuses cut to almost nothing compared to last year.
One insider in SocGen's fixed income business said his bonus had been cut by 75% for 2018. "I get the impression that if you performed well, you will get a tiny amount, if you performed moderately you will get nothing at all, and that if you performed poorly you will lose your job," he said. He added that he'd been expecting a 50% cut, but was surprised when the reduction came in even higher than this. "My review was good, one of the best I've had in the whole time I've been here, and yet my bonus is smaller than ever."
Another salesperson at the bank said that bonuses were, "not good at all" and that, "most people are very disappointed." Senior people said they received bonuses on a par with analysts.
SocGen declined to comment on the complaints. This year's fixed income bonus cuts come after the French bank shaved traders' bonuses by 25% last year too.
In February, SocGen announced plans to cut €500m in costs from its investment bank by cutting fixed-income trading and reviewing its credit, rates and foreign exchange businesses. One SocGen trader said the extent of the bonus cuts is leading insiders to question whether SocGen really wants to remain active in his area of business. "No one is going to want to stay here now." Another trader, however, said there was nowhere else to go: "None of the European banks - except maybe Barclays - is in a good state and is able to pay people now."
SocGen is reportedly eyeing 1,500 redundancies in the investment bank as part of its cost cutting programme. The French bank has a well-earned reputation for paying incredibly generous voluntary redundancy packages and some traders in London voiced a hope that they might benefit from these instead. "At least I'll get some money and I'll be able to get out of here immediately, without sitting out the long notice period," said one.
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