Credit Suisse is preparing to offload more risk exposure to staff in its 2012 bonus giveaway, but significantly fewer managers will be allowed to join the latest version of a scheme that has yielded stellar rewards in previous years.
Reuters reports that, pioneered in 2008, Credit Suisse's ground-breaking asset-backed bonus schemes pay managers a portion of their bonuses in financial instruments whose value depends on the performance of risky assets that the bank is exposed to.
The creation of a new Credit Suisse scheme comes as banks bow to the demands of shareholders and regulators to move away from cash bonuses in favor of alternatives that are more aligned with the risks bankers are taking.
Two earlier schemes have helped the bank to transfer $17bn of troubled loans and derivatives off its balance sheet, improving its capital position since capital demands are directly related to the size of a bank's balance sheet.
The schemes have also allowed the bank to save about $1.4bn on cash or share-based bonus payments.
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