Morgan Stanley CEO: Wall Street Pay ‘Is Way Too High’

Friday, 05 Oct 2012 11:34 AM

By Michelle Smith

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Banking isn't as prosperous as it once was, and firms, adjusting to that reality, have been slashing costs in part by cutting jobs and compensation. At Morgan Stanley, there's likely more downsizing to come.

The firm is already cutting 4,000 jobs, or 7 percent of its work force, by the end of the year, the Financial Times reported.

And in the new year, according to the Times, Morgan Stanley CEO James Gorman said the bank would consider its next round of cost cutting including pay and bonuses.

Editor's Note: You Deserve to Know What Obama and Bernanke Are Hiding From Americans

Companywide compensation and benefits at Morgan Stanley in 2011 increased 3 percent to $16.4 billion, and revenue climbed at the same rate. That was enough to pay each of the 61,899 employees $264,996 on average for the year, according to Bloomberg.

Banks have come under pressure not only from regulators but also from shareholders to address these levels, which by many are viewed as extremely excessive. Firms such as Morgan Stanley, who see their profits in jeopardy, are increasingly caving in.

“As a shareholder I'm sort of sympathetic to the shareholder view that the industry is still overpaid.”

“There's way too much capacity and compensation is way too high,” Gorman told the Times.

Editor's Note: You Deserve to Know What Obama and Bernanke Are Hiding From Americans

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