BofA approves $4 bn for bankers pay

Bank of America will give more than $4 billion as compensation to its investment bankers and traders in 2009, says a media report.

Attributing to people familiar with the matter, The Wall Street Journal said that Bank of America (BofA) has approved more than $4 billion as pay in 2009 for its investment bankers and traders.

The payout represents about 19 per cent of the $23 billion revenue generated by investment-banking and capital-market activities.

The report noted that each investment banker and trader would collect an average of $300,000 to $500,000 for 2009, which is close to what the bank paid during its peak compensation year of 2006.

Further, the report said that about 25 per cent of average compensation would be paid in cash in 2009, with the rest coming as deferred payments of restricted stock or cash that would vary in value with BofA's performance.

The deferred cash would be awarded over the next three years. The restricted stock would vest over a year and a half, with the first portion available for selling in August, it added.

According to the publication, some of the most senior bankers receiving seven-figure payouts are getting five per cent of their year-end payout in cash and the remaining would be in deferred cash or stock tied to the bank's stock price.

Earlier on Tuesday, BofA said its Chief Executive Brian Moynihan would receive a new base salary of $950,000 from January 1.