Credit Suisse asks employees to switch bonus scheme
ZURICH (Reuters) - Credit Suisse CSGN.VX is scrapping a scheme that linked bonuses to risky assets after the plan clashed with capital regulations.
The 5,500 senior bankers who were offered the scheme in 2012 may now choose between two replacement plans, according to extracts of a memo seen by Reuters on Tuesday.
The first is a seven-year program linked to the performance of a portfolio of positions Credit Suisse is exiting. The second is contingent convertible (CoCo) instruments, which are wiped out if the bank's capital falls below a certain level.
Credit Suisse's strategy of paying its employees a portion of bonuses in sometimes risky assets has not only proved lucrative to some recipients, it has also helped cut its exposure to $17 billion worth of loans and deals.
Credit Suisse has yet to disclose its total bonus pool. Crosstown rival UBS UBSN.VX increased its bonus pool by 28 percent to 3.2 billion Swiss francs from 2012, when awards were cut after it had to pay out $1.5 billion to settle allegations of manipulating benchmark interest rates.
(Reporting by Oliver Hirt; Writing by Alice Baghdjian; Editing by Mark Potter)
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