Looks like even more bad blood is in store between Merrill Lynch & Co. and its new parent company Bank of America Corp. Only a week after John Thain sped things up so that Merrill staffers would get $4 billion in bonus money (inspite of a surprise $15 billion fourth-quarter loss), BofA is reportedly planning to defer paying bonuses to its own capital markets and investment banking units.
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Several executives familiar with the situation
tell the Financial Times
that "the restrictive new policy will affect bonus payments of $50,000
or more and is expected to be announced on Thursday, when BofA informs
employees of their 2008 bonuses."
The new arrangement would have the bank's employees waiting until
February 2010 to receive one-third of their bonus, with the remaining two-thirds
doled out in 2011 and 2012. BofA traditionally paid out the full bonus
money in February.
If such a move is to be made, it will likely cause a huge uproar among
BofA's capital markets staffers who are set to merge into one operation
with their Merrill counterparts later this year. The units are also expected
to have to absorb roughly 3,000 layoffs from the combination. -
George White
See FT story
