Bonus attacks may put some bankers on edge
There are likely to be some very nervous bankers around town this weekend after United States President Barack Obama's withering attack on the billions paid out in bonuses as the US government rescued Wall Street.
And now there is talk that New York Attorney-General Andrew Cuomo (left) will be let off the leash to recoup the US$4 billion Merrill Lynch paid in bonuses just before it was acquired by Bank of America Corp.
Merrill staff, including those here, received their money last month, while Bank of America is expected to defer its 2008 bonuses of US$50,000 or more to employees in the capital markets and investment banking units. Bank of America normally pays them in February, but is now arranging to hand over the first third in February 2010 with the remaining thirds paid in 2011 and 2012.
A Lai See straw poll has revealed that other US finance houses such as Goldman Sachs, Morgan Stanley, Citi and JP Morgan have already received, or are about to receive their bonuses, courtesy of the American taxpayer. Most are said to be down by between 50 and 55 per cent, compared to a 44 per cent drop on Wall Street.
All eyes are now on Credit Suisse which next week will pay a portion of its bonuses using toxic assets left over from before the financial crisis in a move to link pay to the long-term performance of credit markets and limit the bank's exposure to the securities.