Why BarCap may be next to reduce salaries
Goldman Sachs has reduced salaries in London, having wisely made a provision to do so in its contracts. Will BarCap be next?
Headhunters and rival bankers who have encountered BarCap's contracts say that when the bank increased its salaries in late 2009, it did so by means of a non-pensionable 'additional fixed payment' which is not part of salary per se.
As such, this could easier to remove than a simple salary hike.
Rivals such as BAML and UBS are understood to have simply raised salaries and could find it harder to reduce them again. "A lot of banks are wondering why they weren't cleverer about increasing salaries," says one headhunter.
A spokesman for BarCap declined to comment.
