Bank of America investment bankers should prepare for a 25% decrease in compensation, Bloomberg reports.
And they should be surpised about it.
This is a part of Phase II of, ‘New BAC’, the plan the Bank of America’s executives formed to change the firm after the financial crises. The bank has sold off assets, decreased its real estate holdings, and announced that 30,000 layoffs are soon to come.
So all that said, changing the company’s business model in terms of compensation only makes sense. But that doesn’t make it any less painful for the bankers, especially not after BofA’s investment bank recorded its second consecutive loss in Q4 2011. According to Bloomberg, Thomas K. Montag’s division posted a $443 million deficit. In Q3 2011 they reported a $302 million loss.