Bonus structure: Billy Bovvered
It seems that the prediction made by my mucker in last week’s column that the changing remuneration structure would result in bankers merely working their hours may be coming true. “As we go back to a pure salary culture, many traders will decide they have no incentive to make more than the bare minimum for their bank – after all, none of the excess profit will find its way into traders’ pockets at the end of the year,” he said.
Anecdotally, I have heard that one corporate treasurer whose company is planning a bond issue was told by his lead manager that he really didn’t care what fees he earned from the transaction. One FX contact tells something similar. “The banks’ management are still visiting and making all the right noises and spouting the same old sound bites, but the sales guys clearly aren’t bothered,” he claims.