Barely a week after it was disclosed that bankers in the City of London will share a pre-crisis level £7 billion bonus pot – even though businesses cannot get credit – it has emerged that many bailed-out bankers are set for record payouts to themselves for the second year in a row despite the faltering economy in the United States and modest revenues.
Pay and bonuses at US banks and hedge funds are up 4 per cent – £90 billion – on last year according to a study of banks, hedge funds and other financial industry firms by the Wall Street Journal.
Bankers’ payouts to themselves are rising faster than bank revenues and now account for at least 23 per cent of profits, according to the study.
At bailed-out Goldman Sachs, which expects a 13.5 per cent drop in revenue, the bankers’ payouts to themselves will nevertheless go up by 3.7 per cent.
Similar generosity is expected at JP Morgan Chase, which received a monumental and secret bailout, and also has the highest number of home foreclosures of any bank. JP Morgan Chase has hired former Prime Minister Tony Blair as an advisor to its board.
The bonus pools for top-tier management have been kept high by laying off lower-paid staff, according to the Wall Street Journal study.
