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Cash before the crash: Credit Suisse paid unusual bonuses to bankers before the crash. According to “Le Temps”, citing the Bloomberg business agency, the bank gave 1.2 billion francs to its employees.
The purpose of the unusual CS payments was to compensate for reduced variable compensation due to poor group results. But this unexpected event did not prevent the massive wave of migration: Last year, about 15 percent of employees left the bank voluntarily.
UBS demanded at least some of the money back. On March 19, it absorbed major bank Credit Suisse and immediately offered multi-year repayment plans to hundreds of bankers. The total was about 651 million francs, an anonymous source told Bloomberg. Lawyers hired by UBS threatened that criminal prosecution would be initiated if employees did not pay back the requested money. UBS did not want to comment on this issue when asked by “Le Temps”.
Refunds are not uncommon
It is not uncommon for employees who leave a company to have to pay back some of their bonuses. These are usually distributed in the form of shares and can be retained by the company if you leave before the agreed deadline. However, due to falling share prices, Credit Suisse preferred cash. However, it added a clause that affected employees would have to pay back a portion of the bonus if they left the bank before the end of three years.
It is questionable whether former CS employees actually have to pay back their bonuses themselves. New employers often give contract bonuses to people they hire. It is intended to cover the bonus not received or the part that needs to be refunded.
Following the takeover of UBS at the beginning of April this year, the Federal Council canceled all bonuses given to Credit Suisse’s senior managers for 2022. Variable bonuses for approximately 1,000 additional employees have also been reduced by at least 25 percent. (Snap)
Source :Blick
I’m Tim David and I work as an author for 24 Instant News, covering the Market section. With a Bachelor’s Degree in Journalism, my mission is to provide accurate, timely and insightful news coverage that helps our readers stay informed about the latest trends in the market. My writing style is focused on making complex economic topics easy to understand for everyone.
