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Nightmare On Wall Street: 2014 Banker Bonuses Set To Drop
To most people it would be shocking that after $60 billion in litigation charges, i.e., the "cost of doing criminal business" for just the first 9 months of 2014 and a ridiculous $178 billion since Lehman...
... the there would be those who are stunned that bonuses on Wall Street may take a hit as a result of all this rampant, and caught, criminality.
Well, "those" exist. They are called bankers, the same group which in poll after poll heading into the end of 2014 predicted that this bonus season would be far better than what was paid out in 2013 (and most of which spent the money well in advance). Alas, that is not going to be the case.
According to the FT, bankers on both sides of the Atlantic are fighting over a diminished bonus pool this year, according to executives. In the UK, most investment banks expect to see bonuses fall after a tough year, but are still braced for political sensitivities over the topic given the looming general election. At US banks, several of which report results this week, payouts are also set to fall.
It wasn't just engaging in crime after crime and getting caught. Far worse: the one thing that everyone was lamenting, the lack of volatility, came back with a vengeance... and nobody was prepared (just see Jefferies results reported one month ahead of the rest of the banks, for the trading bloodbath which took place in the past quarter).
The cuts will impact traders mostly, while advisory bankers are poised for modest rebounds after never having suffered as deep bonus drops in the past: "Traders can expect the worst declines after a weak fourth quarter. Citigroup decided last week that the bonus pool for traders would fall about 5-10 per cent, according to people familiar with the matter, after earlier pledging to hold it flat. Citi’s advisory bankers can expect a modest increase.
One finance officer at a large Wall Street bank said it had been difficult to satisfy the warring parties: mergers and acquisitions and equity underwriting enjoyed a good year but these advisory bankers never suffered the same bonus cuts as traders so they should not expect a big rebound in payouts.
In London people close to big City investment banks such as Deutsche Bank and Barclays said their bonus pools had been hit by weaker fixed-income trading figures and the impact of a European bonus cap, limiting payouts to no more than twice a banker’s fixed pay.
The bigger problem for banks is encapsulated by Tom Gosling, head of PwC’s reward practice, who said: “Bonuses in the UK banks will almost certainly be down, but the problem for the industry is that the public’s trust in banks has never really been rebuilt so, for some, any level of bonus will be too much.”
Remember when banks kept trying to slide through billions in criminal charges as one-time, non-recurring charges, and if you don't, re-read "For Bank Of America, Crime Is Now An Ordinary Course Of Business." Well, it may fool non-GAAP numbers, but management teams have figured out that there is nothing non-recurring about a business model where crime is the primary driver of revenue growth. As a results, some banks, such as HSBC and Royal Bank of Scotland, are expected to deduct from their bonus pools part of the record $4.3bn fines for foreign exchange manipulation that they and four other banks – UBS, JPMorgan Chase, Bank of America and Citi – paid to regulators in November.
The biggest problem is that none other than industry-leader Goldman is slashing pay across the board. And without them to point to and demand equitable treatment, bankers everywhere are out of luck:
Goldman Sachs, often the barometer for industry bonuses, is forecast to pay staff about 38 per cent of revenues in salaries and bonuses. That would be in line with last year’s payout, which was the second-lowest in Goldman’s 15 years as a public company. Before the financial crisis, Goldman typically paid staff more than 40 per cent of revenues.
“The trend is that compensation is trending downwards rather than upwards,” said Mike Karp, chief executive of Options Group, a recruitment company. But US banks are being more generous than their European rivals, particularly by paying more in cash than stock.
...
Mr Gosling at PwC, who estimates bankers’ bonuses have halved since the financial crisis, said: “The [other] problem that British banks have is that they aren’t the price setters in this market — that is the foreign investment banks.”
Still, don't cry for bankers just yet: "The top 121 UK bankers at Goldman Sachs were the best-paid among their peers in Britain in 2013, earning an average of £3m each, according to regulatory filings." But... the Office for National Statistics said total UK financial sector bonuses last year were down about a quarter from their peak in 2007.
There are of course hedge funds...
"With trading revenues still under pressure, Mr Karp at Options Group predicted more competition for traders who could make money. “The pie is not getting bigger; everyone’s going for a bigger slice,” he said. “The war for talent is going to heat up this year because everyone wants this 35-37 year-old who can make $200m in revenues, whether he’s in credit trading or rates trading.”
The only problem is that the vast majority of hedge fund traders have shown they can barely make $2 million in revenues in a market in which everything is now centrally planned, and where the "smartest" money in the room is merely super-levered beta chasers with zero original ideas, and where everyone piles into the same 10 most popular trades at any given time. Sorry, guys, but with such "value-added" you may as well try your luck making money in the real world, while actually doing something productive and constructive for the real economy.
That, and remember...
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I've got their bonus swingin'
eeeeeeeeeeeee.....the horror of it allllll...... note to self cancel West end loft for Tiffany and will keep Soho for Bridget and coke parties.
OMFG!!!
Its gettin pretty tough out there.
I guess the hookers and coke dealers will be takin it on the chin this year.
Always be closing
"Second place is a set of steak knives. Third place is you're fired."
Fuck you! That's my name.
That means no GI Joe with the kung fu grip.
I'll settle for the Steak Knives, thank you...
https://www.youtube.com/watch?v=E8_GVfPuw4M
Looks like they will have to start eating off the $1000 menu for lunches now at their local eatery.
In small business world, 'bonus' is an extra day off somewhere in the year. Fucking basteds.
Bonus losing in the banks?
This is Putin's cunning plans!
You're fired been recently?
Putin did it secretly!
Seeing as the "Small Businesses" are the REAL lifeblood of ANY economy, it is "interesting" to note that the ANNUAL bonuses of even middle-echelon Banking Execs. were as great, or usually greater, than the entire LIFETIME earnings of most SBOs.
Unlike the "Investment Banker" club, SBOs are usually unable to "socialise their losses", since they are usually not members of "The Club", and face an ever steeper upward strugge just to keep up with "Regulations", which have little to do with "Safety", but a lot to do with "limiting the ability to compete with the Better Connected" . . . . .
HOW MUCH OF THAT SQUID "REVENUE" IS from diminished (i.e. looting) LOAN LOSS RESERVES? FAKE BANK, FAKE REVENUE, FAKE EconOme.
why are people forced to give a shit about money?
it's an illusion of our own design.
time to create better
illusions
?
How about a chip that you can (read must) scan anywhere, anytime to transact "freely" and "easily", cuz it's the "new standard [and required] interface" for all transactions? Sounds like a solid next-gen illusion to me.
Sounds like ApplePay. Maybe Apple will buy out the Fed, take over the whole money illusion biz?
IF we get that bad, society needs to be destroyed like sodom and gomorrah.
Really, who the fuck wants to live in a world where all slaves are tagged and bagged?
Oh noes, the inhumanity of it all
https://www.youtube.com/watch?v=XdofmoYcJNE
:Waggles vintage Omega Seamaster:
Banking is for losers. The real money is in tech.
This has to be one of the Golden Ages for bankers ever since Hanky, Geitner, Bush and Barry showered them with hundreds of Billions while simultaneously crushing the Middle Class and Gruberizing more people with 24/7 spin, sports, Kartrashian entertainment, BLS, and general propaganda.
Yeah, but it's like Donald Trump. Heavy into credit, seeking to acquire more debt (notes), and every day he wakes up and has to look at Donald Trump. I actually feel sorry for him, and them.
I hope they got their jollies while the gettin was good. Hanke's Bazooka was like popping a double magnum of Cristal, showering the frenzied crowd and acting like a BSD.
Not a lot trickled down
We're so far removed from REALITY.
These BankScum Parasitic ConMen are not sitting at home reflecting on the Length of their Jail Sentences about to be handed down and saying goodbye to their loved ones , RATHER they are fretting about the diminishing Bonus Pool Booty.
It worked out pretty good for them: ok maybe keep the Lamborghini for 6 more months than you were planning to, but at least no jail time
They should be happy. That much less they're going to lose when the bail-ins hit.
It's getting harder and harder to stash cash overseas - or find someplace to spend those big bonuses. 2015 may be the year of spend it or lose it.
Raindrops on Roses and whiskers on Kittens
Bright copper kettles and warm woolen mittens
Brown paper PACKAGES tied up with string
These are a few of my favorite things
Cream colored Ponies and crisp apple streudels
Doorbells & sleigh bells and schnitzel with noodles
Wild Geese that fly with the moon on their wings
These are a few of my favorite things
When the FED bites
When the bee stings
When i'm feeling sad
I simply remember my favorite things
AND THEN I DON@T FEEL SO BAD.
FUCK ME!
WS's nightmare has not yet begun....
And probably will never begin... Except to some low level drug addict sacrificed for the good of the top tier....
PAY THEM bonuses IN SHITCOIN !
i hear thats real money hahaha
cryptofiat lulz
Banksters are taking cash rather than stock this year, yeah right. I would not want overvalued stock that was on the precipice of a crash
either.
Get to work Mr. Bullard! Oh, meant Mr. Evans!
'Coffee is for Closers!'...did my Birthday Boy have his coffee this morning or not?
I'll take my coffee with lotsa cream n sugar, Muah!
Their bonuses should be like government issued savings bonds but backed by student loans and subprime mortgages.
Redeemable after 10 years or so if they are worth anything.
The trickle down theory in action. "The water always flows downhill" & the corporate equivalent "The shit always flows downhill. So if you want to keep your job eat shit and smile"
Who couldn't love a legalized criminal industry that could come up with sayings like that to justify their actions?
At least in an illegal criminal organization they'd probably just put a hit out on you and kill you to let you off easy.
Oops, with all the suspicious Bankster deaths lately it looks like the legalized criminal gang is starting to increasingly take away business practices lately from the illegal criminal gang
As the MSM would so boldly understate as they downplay and evade the obvious "Is this a troubling trend in the industry? We asked the authorities to comment. They have assured there is no validity to this being a trend. They warned us that jumping to any conclusion that isn't their own would only help to inspire lone gunman, terrorists and conspiracy theorists. The only true source of information and investigation is ongoing by the lawful authorities. And any new developments will be released as the situation permits. They also promised to keep us all updated on any new developments. Now back to Jim in the studio with the new Playdoh ejaculator."
If hard comodities have fallen and Oil has collapsed, if The Euro Zone can't pull a profit and Russia is on the Ropes, If China is in slow down and Japan kneeling over a sword, If Developing Nations are at the point of Riot and King Dollar is flowing Back to Wall Street AND I hear Now, Bankers bonuses are to be Slashed.
Then It's Time
Ding Ding Ding
Give them a gift card to Home Depot. Redeemable for a nail gun and nails!
Poor (non)souls. Can perhaps an aid rally be organized to help them through the cold winter?
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