Bank of America Corp., the biggest U.S. bank, expects to pay substantial bonuses to some investment bankers while keeping the overall cost of incentive compensation below previous years, said a company spokesman.
“Some people will be getting very good bonuses because they had a very good year,” spokesman Robert Stickler said. The overall pool “will not be a record,” he said.
Compensation at financial institutions is under scrutiny after Washington bailed out companies including Citigroup, AIG and BofA at the height of the financial crisis. BofA repaid $45 billion in December, freeing the lender from federal pay restrictions.
“It’s unfortunate timing,” said Shaun Springer, chief executive of Square Mile Services, which advises London financial firms on pay. “But banks have never paid a penny more in compensation than is demanded of them by the competition.”
Goldman Sachs, the most profitable firm in Wall Street history, set aside $16.7 billion to pay employees for the first nine months of 2009. That’s up 46 percent from a year earlier.
Later this month, BofA is expected to report its third loss in the past five quarters, amounting to 52 cents a share.
