Big Wall Street banks are opposed by nature

Director-General and member of the board of Towers Perrin, the Office of human resources management Council, Philippe Poincloux explains why the bonus will remain high this year. It estimated that the new rules the traders pay will shortly change the given.

American institutions are ready to pay 140 billion dollars in bonuses in 2009. This figure surprise you

This figure out now because American banks anticipate very early their results, and therefore payments of bonuses that depend on it. The amounts are huge, but it must be remembered that they are not reserved for traders. It is the set of financial institutions that is concerned, including back-offices, commercial what past Equity markets are taken over, there were a few large merger-acquisition operations, and the entire financial system was able to earn a lot of money. Even if some institutions are remained sealed by credit derivatives, or the "subprime" products on the whole, the performance of financial institutions have been very good. Is it moral or not This is not for me to say.

The bonus will therefore also high in European banks

Yes, because the performance was good. But it can if expected that in Europe the weight of policy and the media encouraged to limit the amounts. In the United States, these amounts will no doubt create some tensions, and continue to oppose "Main street" Wall Street, but major US banks will continue to do what they want to make. With a bit of cynicism, can even say that the Mayor of New York must welcome because it will affect many tax, which will allow the city of his situation.

The gives so not much has changed after the g-20

The results of the g-20 could be only very limited. The major decision was to create a strong link between the equity capital of banks and their commitments. It was the only way to put a limit to the sums which may be paid, but this has not been done. Big Wall Street banks are opposed by nature. Nevertheless, things will evolve: the part of the bonus will be more important and vary depending on the performance of the Bank or its financing and investment activities. The levels from which the bonus envelopes are calculated will be less important. But the real concerns remain for banks. They are in a situation where a small part of their teams generates the bulk of the results.

If the CEO decreases their bonus, he takes the real risk its best teams go with as a consequence a decrease in its results, a fall in stock market and a reduced ability to make acquisitions, without forgetting the ultimate risk of becoming prey. Why do you think that banks are so pressed to repay State aid

Is there really much movement among traders

Of course, there are in the actors investment banks, or even whole teams, who left to go to competitors that pay them better or to create their own business. It affects is the true problem of the banks. To keep their best teams or their best features, they are subject to the law of the market. It will be difficult to keep a very efficient team with 60 of the bonus is spread over three years when a competitor promises more significant, immediate or guaranteed remuneration. An option is to take the risk to let go those who exercise this form of blackmail and bet on most young, less experienced, but while also performing in the term. This requires a powerful individual management at the Bank for investment and funding. A real challenge.