[credit provider=”Chicago Booth” url=”http://www.chicagobooth.edu/news/2007-12-10_dougan.aspx”]
The paycheck bloodbath continues—Bloomberg has just reported that compensation for senior investment bankers at Credit Suisse is down by as much as 30%.The slashed compensation at the Swiss bank are the latest in a string of pay cut news for the world’s biggest banks as their investment banking and trading revenue takes a battering due to a volatile economic conditions. Last week, Morgan Stanley announced it would be cutting pay for senior bankers and traders by 20% to 30%.
Credit Suisse has also made headlines recently for paying their employees 2011 bonuses in derivative-backed bonds—which raised questions about the final payouts on the debt for the employees, although the bank has agreed to absorb $500 million of initial losses from the bonds. The Wall Street Journal noted that payment method was primarily a arbitrage strategy so Credit Suisse could avoid having higher regulatory capital requirements.