NYT: The Party Has Started Again: Are Big Payouts Set for Revival on Wall Street?
The Party Has Started Again: Are Big Payouts Set for Revival on Wall Street?
After the government handed out billions of dollars in bailouts, Congress passed legislation banning all companies that received support from the Troubled Asset Relief Program, or TARP, from paying their top 25 executives bonuses greater than a third of their salary, though they were not subject to specific salary cap. Some firms, like Goldman Sachs and Morgan Stanley, have thrown off the yoke of bonus restrictions by repaying the government bailout funds. While others, like Citigroup and Bank of America, have been focused on raising employees’ base salaries to try to shift attention away from bonuses. Whether through bonuses, base salary or a combination of both, the goal for all of them is the same: To retain their top talent.Goldman is set to pay as much as $20 billion this year, or about $700,000 per employee, The Journal said, citing analysts’ estimates. That would be almost twice the $363,000 it paid on average last year, and slightly higher than the $661,000 average in 2007, according to analyst estimates reviewed by The Wall Street Journal. Morgan Stanley, meanwhile, is expected to pay $11 billion to $14 billion in compensation and benefits this year, also according to The Wall Street Journal.
Note EU-Digest: Unfortunately the taxpayer who has helped bail out the banks could once again be in for a big surprise when the disaster we are in today repeats itself. Where are the promised controls, where are promised checks and balances?
Labels: Banking Industry, Economy, US, Wall Street
