Investment bank Morgan Stanley (MS: Quote) will defer 2012 bonuses for high-earning employees for as long as three years, media reported Tuesday, citing sources familiar with the situation.
As per the reports, the deferral applies to all employees who make more than $350,000 annually and whose bonuses are at least $50,000, except for financial advisers.
Those who earn less than $350,000 annually and whose bonuses total less than $50,000 will receive their cash bonuses in February.
Morgan Stanley is scheduled to inform their employees of their 2012 pay-outs on Thursday. The financial firm has been cutting expenses as it seeks to boost returns for its shareholders. Last week, reports had said that Morgan Stanley plans to cut about 1,600 jobs at its investment banking unit in the coming weeks to cut costs, with about half of the job cuts in the U.S.
Under the new payout structure, Morgan Stanley will split deferred compensation evenly between cash and stock. The deferred cash will be given out in 25 percent portions. The stock portion also will be paid in a similar way.
As per reports, the move is to please regulators who want to see banker incentives aligned more closely with the longer-term fortunes of the banks.
Morgan Stanley shares closed Tuesday’s trading at $20.43, up $0.36 or 1.79 percent. In the after-hours trading shares edged up 0.29 percent.
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by RTT Staff Writer
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