Profits doubled at Merrill Lynch’s Latin American business. JPMorgan expanded its operations rapidly, with high-profile clients at the forefront of its growth. Regional heavyweights UBS and Credit Suisse continued to perform well, driven by the Brazilian IPO boom, and Citi’s Latin American operation grew by about 60%.
But as Merrill Lynch, Citi and UBS continue to announce large write-downs on their credit businesses, their competitors are left wondering what level of compensation these banks can afford to pay. Will it be sufficient to hold on to the talent needed to continue the success of their Latin banking operations?
Performance-related pay
At Merrill Lynch, the senior management made it clear during an analysts call that they intended to pay the business areas according to their achievements, and at higher levels than in the past. If this is the case, Merrill’s Latin American employees stand in good stead. But rumours are rife about whether the US bank will be able to live up to some people’s bonus expectations, especially considering the aggressive salaries it apparently offers when recruiting. "Earlier this year I saw some of our youngest guys go over to Merrill for more than three times the compensation," says a Wall Street banker.