$39bn Bonus On Wall Street Despite Losses

Posted by Rob

January 23, 2008

In 2007 the five biggest Wall Street banks gave out a record $39bn in bonuses, according to Bloomberg.

The banks announced record losses and write-offs in the fourth quarter of 2007.

This trend has continued into 2008 with announcements of further losses by Citigroup and Merrill Lynch.

Despite dismal results and a distinct lack of profits in 2007, the top fund managers and traders received bonuses into the millions.

$39bn split by the 186,000 employees at the five largest Wall Street firms would average bonuses of $211,849 each.

How long can such large bonuses be paid out when the markets are performing so badly. With the money situation getting tighter globally, large Wall Street bonuses may be short-lived if the markets don’t pick up.

Wall Street

Wall Street fell again today, marking six-straight days of losses. European stocks also fell after weak data reports and fear of more bank write-downs.

Less than an hour after the opening bell in New York, the S&P 500 index was down 1.6%. The Nasdaq Composite fell 2%, taking the decline from its October peak to more than 20%.

London

In London the FTSE 100 closed more than 100 points lower following on from weakness on Wall Street.

UK equities failed to hold onto Tuesday’s 2.9% gain after the latest minutes from the showed a larger than expected vote for holding the interest rate.

[top]