Fortunately ML/BofA doesn't have clawbacks

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Had it happened at another bank, it could have triggered something nasty.

Alexis Stenfors, a London-based currency trader at Merrill Lynch, has been suspended after allegedly making $400m (284m) loss in the final quarter of 2008, instead of the $120m profit he claimed.

The <a href=" "Financial Times says the loss would -

'...cut into, but not erase, the profits of Merrill's rates and currency operations, headed by David Gu in London.

If the allegations prove correct, Stenfors will undoubtedly lose the bonus he was paid for generating his fictional profit. If they same thing had happened at UBS and possibly Morgan Stanley, RBS, and Citigroup, it could also have triggered clawbacks for deferred bonuses held in escrow for other members of the rates and FX business.

As far as we are aware BofA doesn't operate such a scheme. And in any case, Merrill bonuses were safely paid out before the merger was finalised. Merrill's rates and FX team are lucky they don't work elsewhere.

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