Banks to cut bonus payments

Steve Dinneen
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CREDIT Suisse yesterday became the first bank to pass on the UK 50 per cent bonus tax to staff.

The top 400 UK bankers at the Swiss Institution will see their bonuses cut by more than a third. There will also be a five per cent cut in the global bonus pool, applicable to any of the bank’s employees eligible for a bonus.

Credit Suisse is the first bank to spell out exactly how the 50 per cent bonus levy will affect the way it remunerates staff. Its move contradicts the view that banks would take the hit themselves by increasing the bonus payouts.

The move came as Deutsche Bank said yesterday it would raise fixed salaries for staff and cut variable pay. Barclays and others have already lifted base pay to avoid some of the tax.

Meanwhile, bankers at Goldman Sachs had yesterday expected to receive information about their payout ahead of their employer’s full-year results, which are due on Thursday. The bank sparked outrage when it was suggested it would pay more than $20bn (£12.2bn) in compensation this year, only months after benefiting from a $10bn taxpayer bailout. Goldman denied the Financial Services Authority had blocked its compensation package plans.

Meanwhile, the international will to add taxes on banks is gathering force. Yesterday Swedish finance minister Anders Borg called on his counterparts in the European Union to impose a US-style levy on the industry.