US banks 'more careful about bonuses'

17 January 2011

American financial institutions have become more discerning about which top employees receive bonuses, but this year's overall remuneration will remain similar to 2010, it has been claimed.

The Independent reports that leading Wall Street investment banks Morgan Stanley and Goldman Sachs look poised to hand out a total of $32 billion between them, allocating bonuses depending on the profitability of individual divisions.

"Banks are operating with bulls-eyes on their chests when it comes to issues of pay," said David Wise of consultancy firm Hay Group. "What used to be more or less guaranteed is no longer a ticket to a seven-figure pay programme."

North Carolina-based Bank of America - which also owns Merrill Lynch - is expected to announce its performance-related payouts for 2011 when it publishes its annual results later in the week.

Last week, British government minister Michael Gove accused banks of "living in a parallel universe" over pay during an appearance on the BBC's Question Time.

By Claire Archer

Become a bobsguide member to access the following

1. Unrestricted access to bobsguide
2. Send a proposal request
3. Insights delivered daily to your inbox
4. Career development