A tough time in the equity markets, and less-than-stellar M&A stats can only mean one thing. Bonuses will be down 20-30% at most investment banks when they are paid out later this month.
For all of our friends in management at the various investment banks around the Street, here is a cheat sheet of
excuses reasons to use for your upcoming “bonus communications” with your team members (in no particular order). Feel free to use them if you get stuck for your own:
1. We took a serious loss on the trading desk ’cause the fixed income rate desk was on wrong side of the yield curve.
2. O&G revenue was down 50% this year.
3. The bank increased credit provisions in the loan book given what’s going on in Europe.
4. Our CEO recommended a full payout this year, but the Board of the Bank knocked it back.
5. We paid a “Lumber Contract” last summer when we hired the new real estate team in the New York office, and that hit the bonus pool.
6. Remember that bought deal that was hung for the longest time? It’s still sitting in inventory.
7. Given the market volatility and weak deal pipeline, the firm is in the process of downsizing the team and their severance packages hit the pool.
8. The TSX/LSE/Maple deal didnâ€™t close, so M&A missed their budget this year by $30 million.
9. We sold an underperforming division to [fill in blank bank] and took a bath on the write down.
10. We had to pay the mining team.
For those of you who are on the receiving end of reasons such as this, feel free to use the comment section. But don’t forget, no matter how “bad” it is, you’re still part of “the 1%”.