BofA spends $4.4B on its Wall Street bankers
Bank of America spent $4.4 billion last year on its Wall Street bankers , according to a person familiar with the matter.
The nation’s largest bank used 19% of the $23 billion in revenues it generated in 2009 within its markets and investment banking businesses to pay workers’ salaries benefits as well as year-end bonuses.
That works out to an average of about $440,000 per employee. The bank has roughly 10,000 workers in its markets and investment banking units.
“We are trying to balance the need to pay competitively and to respond to concerns about the level of compensation on Wall Street,” said Stickler.
Faced with a public backlash over outsized bonuses, many of the nation’s largest financial firms have incrementally lowered pay levels for traders and investment bankers.
Many institutions have offered workers less cash and more stock, in an effort to tie workers’ performance with the firm’s fortunes and the interest of shareholders.
The use of so-called “clawback” provisions, which would reclaim pay from workers whose actions may damage the firm’s long-term financial health, have also gained momentum recently.
The issue of compensation has haunted Bank of America for much of the past year after it was revealed that the firm paid $3.6 billion in year-end bonuses to Merrill Lynch workers for fiscal year 2008. The firm is currently facing two legal actions by the Securities and Exchange Commission over the matter.
Compared to some of its peers, the amount Bank of America spent on its Wall Street employees appeared to fall in the middle of the pack.
Last month, JPMorgan Chase (JPM, Fortune 500) said it spent $9.33 billion to compensate workers in its investment banking division. Divided among the nearly 25,000 individuals in this business, the average annual compensation per employee was nearly $380,000.
Goldman Sachs (GS, Fortune 500) also revealed during the latest earnings season it spent approximately $498,461 a person, if its compensation pool were divided evenly among the firm’s 32,500 employees