Credit Suisse will pay the executives in leveraged loans and commercial
mortgage-backed debt that will be placed into a partner asset facility.
Employees at the bank will be given stakes in the facility as part of
their pay, with the new bonus pool taking the first hit should the
securities decline further in value,
according to Bloomberg.
The deal actually works out well for both the Swiss bank and the
employees, since the risk from the $5 billion in assets no one wants is moved
off of Credit Suisse's books, while the senior managers who might not
have received anything considering the state of the bank, get
something ... which, I guess, is better than nothing (and certainly shouldn't prompt the public outrage of giving cash bonuses). After all, not all of the securities can go to zero, and sometimes it's good to eat your own cooking. -
George White
See Bloomberg story
Comments
It appears that Credit Suisse Group may have finally figured out a way to curb the risk-taking behavior of its senior employees ... by giving them bonuses in the form of $5 billion of the toxic mortgage-backed assets that lie at the heart of the credit crisis. 
Wall Street never ceases to amaze. This is a brilliant idea that only the wizards on the Street could dream up.