Here’s your bonus, pal; don’t mind the toxic stench
Banks are facing harsh criticism for the way they handle bonuses for top executives. Given the current financial crisis and the massive injection of taxpayers’ money into troubled banks, huge compensations for the people whom many say are responsible for the mess looks not just unjust but also unethical.
Amid calls to hold bankers accountable for the trouble, financial moguls are cutting bonuses and finding other ways to quell down public anger, yet still not loose their experts by denying them money they were counting on.
Credit Suisse has decided to substitute part of the bonuses it pays to mid-level managers with the very toxic assets they’ve made, reports the International Herald Tribune. Some US $5 million of the troubled assets will be allocated to a fund it calls the Partner Asset Facility and will end up in the directors’ and managing directors’ pockets. Cash saved this way will help curb losses for shareholders.
The bank recently announced it was going to cut 5,300 jobs, or 11 percent of its staff. It will also pay no bonuses at all to its top managers.