Feb. 15 (Bloomberg) -- BNP Paribas SA, France’s largest bank, joined Credit Suisse Group AG and Deutsche Bank AG in cutting 2011 bonuses after quarterly profit plunged at its corporate- and investment-banking unit.
“Bonuses are going to be down by half in 2011,” BNP Paribas Chief Executive Officer Jean-Laurent Bonnafe said in an interview with Bloomberg Television today. “In any case, those remunerations are always in line with the financial results.” He didn’t provide further details on the bonus pool’s size.
The world’s largest banks, including Frankfurt-based Deutsche Bank and JPMorgan Chase & Co., are curbing pay as they face shrinking revenue and tighter capital requirements. Credit Suisse, based in Zurich, said Feb. 9 it cut the 2011 bonus pool by 41 percent after the securities unit posted a second consecutive quarterly loss. UBS AG, Switzerland’s largest bank, said last week it reduced its 2011 bonuses by 40 percent to 2.57 billion francs ($2.8 billion) after its investment bank also reported a second straight quarterly deficit.
BNP Paribas’s fourth-quarter pretax profit at the corporate- and investment-banking division slumped to 6 million euros from 1.09 billion euros a year earlier. Sales at the unit fell 40 percent to 1.65 billion euros as fixed-income revenue slid 68 percent, hurt by losses from selling sovereign bonds.
BNP Paribas said Nov. 16 it plans to cut about 1,400 jobs at the division, or 6.5 percent of the unit’s staff worldwide. The Paris-based lender booked 184 million euros in one-time costs in the fourth quarter after starting the job-reduction plan.
Deutsche Bank, Germany’s largest bank, cut its bonus pool by 17 percent as it lowered the cash component by 37 percent, CEO Josef Ackermann said Feb. 2.
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