Tags: banks | pay | compensation | bonus

Fortune: The Wall Street Punchbowl Is Still Full

Friday, 26 Apr 2013 10:24 AM

By John Morgan

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Pay for Wall Street bankers has not really been curbed despite regulations aimed at stopping the lavish practices that helped spark the U.S. financial meltdown, according to Fortune.

Average pay packages in the securities industry were $362,900 in 2011, about the same as in 2010. State data showed the average cash bonus in New York rose in 2012 by about 9 percent to $121,000.

And while maximum bonuses have been lowered since the meltdown in some instances, base salaries have risen and banks have been giving employees more stock and other long-term compensation, Fortune reported.

Declassified:
‘Financial War’ Could Wipe Out 50% of Your Wealth’

The magazine said compensation in the New York securities industry grew at an average annual pace of 8.7 percent between 2009 and 2011 — noticeably higher than the 5.3 percent growth elsewhere in the private sector, according to figures from the state comptroller’s office.

The Federal Reserve has urged banks since the financial crisis to put caps on bonuses, partly in order to discourage executives from taking too much risk in order to collect higher payouts.

Regulatory filings show seven big U.S. financial firms — PNC Financial Services Group, Capital One, Discover, BB&T, KeyCorp, U.S. Bancorp and SunTrust — said they are trimming maximum bonuses awarded to executives who beat their performance goals, according to The Wall Street Journal.

In Europe, where regulators are finalizing measures to put a lid on bankers’ short-term cash bonuses, some banking executives are considering boosting salaries in order to make up the difference, The Journal said.

However, compensation for directors continues to rise, The New York Times reported. Average compensation for directors at the six biggest U.S. banks in 2011 was $328,655, compared with $232,142 for directors at almost 500 publicly traded companies.

The Times said average annual compensation for a director at Goldman Sachs was $488,709 in 2011, up more than 50 percent from 2008.

Goldman’s board is the best compensated of any big U.S. bank, and compensation for its directors is expected to soar for 2012 since they are paid in the firm’s high-performing stock, according to The Times.

Declassified: ‘Financial War’ Could Wipe Out 50% of Your Wealth’

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