Wall Street cash bonuses down 8%
- 24 February 2011
- From the section Business
Cash bonuses for Wall Street bankers fell by 8% to an average $128,530 (£79,259) in 2010, according to New York state Comptroller Thomas DiNapoli.
"Cash bonuses are down, but that's not an indicator of a weakness on Wall Street," said Mr DiNapoli.
In fact, overall compensation, including stock awards, grew by 6% in 2010.
Banks have been reforming pay and bonus structures after the global credit crunch and subsequent economic crisis.
They were accused of paying too much to staff who took too many short-term risks.
Regulators have called on Wall Street's banks and brokerage firms to lock staff into longer-term pay and bonus structures that reward steadier, less risky investments.
As a result, there has been shift toward more deferred compensation and higher base salaries.
And while this may change the way bankers are rewarded, it is also having an impact on tax revenues, Mr DiNapoli said.
"The industry's greater emphasis on deferred compensation will hold down tax collections this year, but the state and the city will benefit in future years when taxes are paid on this deferred compensation," said Mr DiNapoli.
Wall Street banks were loudly criticised last year when it was revealed that bankers cash bonuses rose by 17% in 2009, despite many financial institutions being bailed out by the taxpayer.
For 2010, the comptroller estimates that the bonus pool at Wall Street firms will total $20.8bn.