BofA divided as banker cry foul over special bonus treatment

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Photographer: Scott Ells / Bloomberg

Anger is brewing in senior range Bank of America Corp waived an unpopular new bonus policy for top traders and traders while the company plans to replace other employees.

At issue is a grant of company stock that high-income people – typically making $ 1 million or more – received for the first time as part of their 2020 compensation. Instead of vesting in equal parts over a set period, as such awards generally do, these bonuses have a “cliff vest” provision that makes shares eligible for sale only at the end of four years.

People familiar with the situation described an internal drama over the past few weeks.

Initially, the bank planned to broadly implement the new pay structure. But giants in investment banking and business revolted upon hearing that they would have to stay until 2024 for bonuses for 2020, and management agreed to exempt them.

In an interview on Bloomberg Television on January 27, CEO Brian Moynihan said the change in policy “did not work the way some people wanted it to, so we fixed it.”

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Brian Moynihan, Chief Executive Officer of Bank of America Corp

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Yet the less powerful peers, the senior peers of corporate and commercial banking, soon find out that their rewards are still subject to vested restrictions. When the skirmish began, people said. In recent times, employees have been discussing calls to frustrations and vent options.

The decision touched a raw nerve. Bank of America is torn apart by the long-standing jealousy and division among its employees of more than 200,000 from a shotgun marriage to Merrill Lynch in the 2008 financial crisis. A disproportionate approach to compensating risk eliminates those strains at a time when the majority of the company is working from home and collaboration is at a premium.