JPMorgan Trimming Bonuses, Investment Banking Jobs
For employees at JPMorgan Chase & Co.(NYSE:JPM), it appears the Grinch will be in charge of year-end salary performance reviews and bonuses this year.
According to Bloomberg, company managers are telling employees that the firm’s total average compensation may either be lower or unchanged as compared to last year and that year-end bonuses will likely depend on the corporate profits and the performance in their respective divisions.
It hasn’t been a bad year for JPMorgan.
While the company saw a record $17.4 billion net income in 2010, it could see an even higher one this year, an estimated $19.1 billion amid shrinking revenue and profit margins, according to analysts’ forecasts. In addition, average compensation for the bank’s 256,000 employees this year could either drop or remain stagnant among an industry that has seen massive layoffs.
For 2011, this has included more than 200,000 job cuts worldwide. But JPM isn’t the only big bank cutting bonuses and laying off workers. The same dark cloud has hit Goldman Sachs (NYSE:GS), Citigroup (NYSE:C), Bank of America (NYSE:BAC), and Morgan Stanley (NYSE:MS).
Investment bank staff to see cuts
J.P. Morgan’s (NYSE:JPM) investment bank personnel will also be hit with smaller bonuses. Net income for the division during the first nine months of this year increased 18% to $6.1 billion from this previous year, according to Bloomberg; however, the company’s compensation practices aren’t made public.
In an Oct. 13 conference call, JPMorgan CEO Jamie Dimon said the bank isn’t planning layoffs; however, he said “we always trim our sails.” The investment bank did cut its workforce 4% in the third quarter, up from the second quarter.
Dimon added that the bank will be “squeezing a little bit here and squeezing a little bit there” to further cut investment bank staff in the next 18 months by about 1,000 people, or “maybe a little bit more.”