Contrary to hope/expectation, it now appears that UBS has done the deed and paid zero bonuses to a lot of people in its investment bank.
CNBC reports that US managing directors and senior vice presidents at UBS were told yesterday they will be paid absolutely nothing at all as a bonus this year, followed by 100% stock bonuses in 2010, a third of which will vest next year, another third of which will vest in 2011, and the final third of which will vest in 2012.
Even worse, the new bonus arrangement includes a claw back provision so that if UBS incurs a
loss at any time over the three year vesting period, the bonus won't be paid at all.
Headhunters in London confirm that, 'everyone' at director level and above in the investment bank is been paid little or nothing at all this year. "It seems to apply across the business - even in equities, where UBS has done quite well," says one.
UBS did not immediately return a call asking for comment.
Earlier this week, The Times reported that UBS had a 1.3bn bonus pot, down from 6bn last year.
It now appears that the depleted bonus pool is being channeled to the private banking business, which is a strategic priority - unlike the investment bank.