Bank of America is planning to defer 2008 bonus payments to some staff at its capital-markets and investment banking units, the Financial Times reported quoting executives familiar with the matter.
The bank will defer bonus payments of $50,000 or more. Employees who normally receive their 2008 bonuses in February will be paid the first third of that sum in February 2010, with the remaining thirds paid in 2011 and then 2012, the executives said, according to FT.
We traditionally don't comment on our compensation plans, particularly in advance of sharing details with our associates. Your story is not entirely accurate, a spokesman for the bank told FT when asked about the plan.
Executives at Bank of America said the deferred bonuses could lead to departures beyond the 3,000 or so cuts expected in the unit this quarter, FT reported.
Meanwhile, New York attorney general Andrew Cuomo is investigating Merrill Lynch's decision to pay bonuses worth $4 billion to executives, just days before its merger with Bank of America was completed.
The bonus payments created controversy after Merrill Lynch reported an unexpected loss of $15 billion in the fourth quarter. Merrill paid the bonuses in the same quarter when it usually pays them in January or February.