TARP Recipients and their Bonuses

These are really three different issues: 1) The CEO compensation; 2) Commission/P&L bonuses of profitable employees; 3) Misaligned compensation packages of the CDO/mortgage-backed buying managers.

The first one is a symbolic issue (and is irrelevant IMO) and the second one is perfectly appropriate — its the 3rd one that has become so problematic.


2007senior-officer bonuses*/ total bonus pools**
Bailout money

Bonus Pools

Merrill Lynch
Reportedly, in December, just before Bank of America took over, John Thain quietly awarded $3 to $4 billion in bonuses, a month earlier than was customary.
Bank of America
The company granted 2008 retention bonuses to 6,200 Merrill brokers, and C.E.O. Ken Lewis declined to answer a question about this year’s bonuses at a shareholder meeting in December.
Goldman Sachs
Average compensation is reportedly down 45 percent in 2008 but will actually be a greater share of revenues than in 2007.
Morgan Stanley
The firm’s 2008 bonus pool is down 50 percent but is still estimated at $5 billion.
The ratio of compensation to revenues is reportedly not remarkably different for 2008.
Wells Fargo
C.E.O. John Stumpf and top executives have not said they will forgo their 2008 bonuses as of mid-January.
J. P. Morgan Chase
While net income was down 64 percent in 2008, bonuses are reported to be down only 30 to 50 percent.
*Total of top five bonus packages (including stocks) received by highest-ranking officers.

**Estimated as 60 percent of compensation where exact figures are not available.


Bonus Babies: The Big Tarp Recipients and their Booty
Christopher Bateman
Vanity Fair, February 2, 2009, 10:00 AM

Wall Street’s $18.4 Billion Bonus
Michael Shnayerson
Vanity Fair, March 2009

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