Bank of America juniors joined the bonus complaints band
It was a few days ago now, but on Monday - back when HSBC's London bankers were still blithely employed - Bank of America announced its bonuses. People there don't seem entirely happy.
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The good news is that Bloomberg's prediction earlier this month that BofA would hike bonuses by 10% doesn't seem to have been wide of the mark. The problem is that many were expecting more.
How much more? Our pre-Christmas bonus expectations survey suggested the average BofA employee was expecting an increase of nearly 38%. This wasn't forthcoming.
One investment banking director at BofA says his bonus increased by 10% and was more than 100% of his salary. "In the context of our revenues, this was not great," he says. Another associate in New York said the "vibes" were not great and that he was flat. An associate in London said first year associates got between 30-90% of salary and associate 0s got a $45k stub bonus. "It seemed pretty flat compared to last year," he agreed.
There is whinging, too, about deferrals and the BofA appraisal system. The bank is seemingly now deferring a lot more than in the past, with up to 30% of junior bonuses tied up in stock for years. It uses rankings of 'exceeds expectations' (EE), 'meets expectations' (ME), 'exceeds meets (EM) and 'meets meets' (MM). The curiously named 'meets meets' still means you are doing your job well. However, only people doing something above and beyond at BofA get an E in their rankings. Multiple insiders complain that in this year's bonus round, junior bankers ranked as ME were paid very similarly to those ranked as EM. "There wasn't enough spread between the buckets," says one associate. "Performers were not paid enough. Underperformers were happy, especially when they know they won’t get fired."
The whinging comes after Bank of America clamped down on excessive hours for junior bankers after Leo Lukenas, an associate on the financial institutions group (FIG) team died last year. Insiders say the bank has since become vigilant at monitoring working hours. "Analysts are flagged if they work more than 80 hours a week. At 90 hours a week the team head gets involved, and 100 hour weeks aren't really allowed any more," said one insider. "The very bad spikes in hours seem to have been removed."
Like Citi, there are some indications that BofA may have squeezed the middle and back office to pay the front. One BofA risk professional tells us he got a top appraisal, but his bonus was inexplicably cut by 10%.
Bank of America's M&A revenues were up 8% last year. Deutsche Bank today, announced a 77% increase.
Bank of America declined to comment.
Photo by Glenn van de Wiel on Unsplash
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