Executive pay

A number of banks such as Morgan Stanley, Goldman Sachs and JPMorgan Chase & Co plan to follow Citigroup and Bank of America in allowing shareholders to vote on executive compensation, reports the Wall Street Journal, citing unnamed sources with the knowledge of the case.

Under the statutes of the last year’s Dodd-Frank financial reform there should be a say-on-pay vote at least three years at most big U.S. companies.

According to the estimates made by the Wall Street Journal total pay at U.S. banks and securities companies increased by about 18% to a record $145 billion in 2009. The figures were cited in an analysis of the Journal online.

Executives, traders, investment bankers, money managers and others at 38 top financial companies can expect to earn slightly more than in the record year of 2007, according to the analysis.

The journal says the figures are based on securities filings for the first nine months of 2009 and revenue estimates through year-end.
 

Bankers at Bank of America Corp will be paid their bonuses at the levels close to those of 2007 as the company tries to reduce defections following its takeover of Merrill Lynch & Co., reported the Wall Street Journal citing the source familiar with the case.

Some bankers will likely receive bonuses equal to what they got in 2007 while the overall average is expected to be lower.

 According to some reports American International Group Inc probed five executives who threatened to resign over federal pay limits. U.S. pay czar Kenneth Feinberg has vowed to limit bonuses at AIG's financial products unit, which produced negative reaction on the part of the insurer’s employees.

Goldman Sachs Group is being sued by an institutional investor who claims the firm is preparing to pay out improper bonuses.

The lawsuit, filed with the New York Supreme Court by the Security Police and Fire Professionals of America Retirement Fund, names chief executive Lloyd Blankfein and other executives and board members as defendants.

Goldman has faced a maelstrom of criticism for setting aside billions for year-end payouts soon after the firm paid back its $10 billion taxpayer bailout.

 Bank of America will likely extend its search for a new CEO into the next year if the board is unable to find a candidate within the following several days as reported by the Bloomberg News who cited the sources familiar with the matter.

Bloomberg notes that at least four external candidates including Citigroup director Michael O' Neill had rebuffed approaches about the job. Thus, the directors may extend a November 26 target date for an appointment and beyond Lewis' expected December 31 retirement date.

 The Obama administration's executive pay czar said his authority should not be expanded beyond setting compensation guidelines for seven banks and automakers that have received extraordinary taxpayer bailouts.

Kenneth Feinberg, the U.S. Treasury bailout program's special master for compensation, told lawmakers in prepared testimony scheduled for delivery on Wednesday that his authority should remain limited to the firms specified by the Treasury.

 Christian Noyer, a European Central Bank Governing Council member, delivering a speech at a financial conference in Singapore on Monday, said that banks are taking today the same risks that were at the heart of the world financial crisis and said that instead of paying immense compensations to their managers banks need to preserve more capital.

 Being a good example of democratic and rightful society America has still retained many prejudices. In particular this is much evident when it comes to women’s role in the economical and political live of the nation. Forbes magazine published a post where it cited some most paid female CEOs in the US with a clause that says women are still less compensated on these positions than their male peers.