Credit Suisse delaying compensation day for some of its investment bankers

BOSTON – Credit Suisse Group is delaying a much-anticipated compensation day for some of its investment bankers, further straining its relationship with employees as it restructures its Wall Street operations, according to people familiar with the matter.

The investment bankers – mainly at managing director or director level – were notified on Monday that meetings set for Tuesday have been cancelled, pushing back conversations on bonuses, said the people, who requested anonymity discussing confidential information. The discussions may be rescheduled in the coming weeks, the people said.

The bonuses are typically paid at the end of the month.

A spokesman for Credit Suisse declined to comment.

Staff inside Credit Suisse’s investment-banking arm have contended with uncertainty amid the Zurich-based lender’s plans to merge those operations with rainmaker Michael Klein’s advisory boutique.

The combination is supposed to form a First Boston unit that will eventually be spun out. Credit Suisse said in October it received a commitment for a US$500 million (S$664 million) injection into the business, but has not identified that investor. 

The Swiss lender is already

cutting its overall bonus pool for 2022 by as much as 50 per cent

after a year in which it was forced to raise capital. At the same time, the bank’s leadership is offering some senior staff upfront cash payments to incentivise them to stay. 

Credit Suisse, seeking to draw a line under

years of losses and scandals,

has said it would carve out its deal-making businesses under the storied First Boston brand and tapped Klein to try to return them to their former glory.

Credit Suisse First Boston (CSFB) is set to be a partnership, giving senior employees some ownership. 

The Swiss bank has said it would bring other investors into CSFB and lower its holding over time.

Apollo Global Management is among financial firms showing interest in taking a stake in the unit, the Wall Street Journal reported on Tuesday.

Former Barclays chief executive Bob Diamond’s Atlas Merchant Capital and

Saudi Arabian Crown Prince Mohammed bin Salman are among investors

that have weighed putting money in, Bloomberg has reported.

Any delays in bonus payments would be painful ahead of tax season, where bankers often use portions of the reward to cover those bills. It could also adversely impact the younger directors, who are likely to have more onerous mortgage burdens than their more tenured peers. BLOOMBERG