What we're hearing about deferrals and vesting, bank by bank
Bonuses are trickling out. As we mentioned yesterday, they're surprisingly liquid. Here's what we're currently hearing and reading about who's getting what and when.
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%.
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.
Other things of note -
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Credit Suisse investment bank
Comp per head, 2010:
Not available yet.
Percentage in cash, percentage deferred
Credit Suisse announced a new compensation policy last year.
This stated 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
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.
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.
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.
JPMorgan investment bank
Comp per head, 2010:
$349k
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.
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.
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 very well.
