If earnings of banks continue to be on the green, the days of big pays could be upon us once again. And I’m not really bothered by it. From analysts’s estimates, Goldman Sachs could pay as much as $20bn this year, or about $700,000 per employee. This figure is not only much higher than the figure from last year ($363,000) but it could also be slightly higher than the figure prior to the beginning of the recession in 2007 ($661,000). On the other hand, there is Morgan Stanley who might shell out between $11-14bn or about $262,000 per employee. This is, however, lower but not very far from the figure for 2007.
Charting that from WSJ:
Take note that the high pay is not for everyone. Those in the junk bond trading are expected to earn more than those issuing asset-backed securities. Perhaps the only development we can see is that some banks are including clawback provisions in their pay policies. In order to elude the bonus caps, some are moving on to increase the base salary.
More on the WSJ HERE.