"Credit Suisse Group's novel plan to pay bankers with a brew of its own toxic bonds and corporate loans has gotten off to an unexpectedly strong start, which could put further pressue on other Wall Street firms to change how they pay their employees. ... Many were originally skeptical of the plan, with one decrying what he called the 'eat your own cooking' plan as unfair to employees who didn't contribute to the bank's 2008 net loss. ... But banks are increasingly desperate to pay employees without triggering outrage in Washington and other capitals. ... The employees who got the fund can't cash out of the shares for at least five years", Aaron Luccchetti at the WSJ, 7 August 2009, link: http://online.wsj.com/article/SB124960277918712887.html.
Something like this is long overdue. I called for this type of compensation structure years ago.
2 comments:
I hope nobody complains that the banks undervalued the toxic junk when they awarded it and marked it nicely when it was in the bonus pool...
It's probably Level 3 assets... wouldn't the bank have to take the writedown on their income statement?
I applaud Credit Suisse for this move. Let them suck on their own toxic assets and see how they like it.
I'm going to find it to be entertainment if they end up making bucketloads of cash as a result.
Jr
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