Andrew Cuomo Bonus Report Released To The Public Earlier Today
A long-awaited report from New York Attorney General Andrew Cuomo has finally been released to the public, and the information contained in the report is likely to stoke more rage against some of the largest banks in America.
Cuomo's report, titled "No Rhyme or Reason: The 'Heads I Win, Tails You Lose' Bank Bonus Culture", was released earlier today. I have included a link to the report at the bottom of this article.
The report focuses on the nine original TARP recipients (Citigroup, Merrill Lynch, Morgan Stanley, etc.) and the bonuses that were paid out to their employees.
According to the report, a total of $33 billion dollars in bonuses were paid out in 2008 by the nine banks that originally received TARP funds.
The report alleges that these banks continued to pay out sky-high bonuses despite the fact that their earnings were plummeting and billions of dollars of government funds were being accepted.
Citigroup, which received a total of $45 billion dollars in TARP funds last year, reportedly paid out a total of $5.33 billion dollars in cash and stock bonuses.
These bonuses came despite eye-popping losses of near $30 billion dollars in 2008, as well as the destruction of countless billions of dollars of shareholder value.
In total, 738 Citigroup employees received "at least" $1 million dollars in bonuses last year, despite the company receiving $45 billion dollars in taxpayer's money.
Merrill Lynch, which also suffered crushing losses in 2008 (and which also received billions upon billions of dollars in taxpayer funds), paid out a reported $3.6 billion dollars in bonuses in 2008.
Together, Citigroup and Merrill Lynch "lost $54 billion, paid out nearly $9 billion in bonuses and received TARP bailouts totaling $55 billion".
Bank of America, which also received a whopping $45 billion dollars in TARP funds, paid out $3.3 billion dollars in total bonus money last year. 172 BAC employees were paid at least $1 million dollars in bonus money, while the top four recipients received a combined $64.01 million dollars.
Goldman Sachs, Morgan Stanley and J.P. Morgan Chase, three firms that also received TARP funds, paid out bonuses in 2008 that far exceeded their earnings for the year.
These three companies, which received a total of $45 billion dollars combined in TARP funds, paid out a total of $18 billion dollars in bonuses, despite having only earned a total of $9.6 billion dollars.
Wells Fargo & Co., which lost a staggering $43 billion dollars in 2008, paid out nearly a billion dollars in total bonuses. The company received $25 billion in TARP funds.
The Bank of New York Mellon and State Street Corp., two of the other banks that initially received TARP funds, paid out approximately $1.3 billion dollars in total bonus money.
The title of the report is derived from the realization that these banks don't seem to have any rational method of compensating their employees.
If things are going great, then billions of dollars in bonuses are paid out.
If things are going horribly, then billions of dollars in bonuses are paid out.
To me, Citigroup is the most unbelievable of the nine banks included on the list.
How does a company that posts a loss of $27.7 billion dollars and receives $45 billion dollars of taxpayer funds still pay out $5.3 billion dollars in bonuses?
Source: Andrew Cuomo Bonus Report
Filed under: The Economic Meltdown