Investment Banking

Click here to load reader

Embed Size (px)

description

US Banking performance & bonus controversies

Transcript of Investment Banking

  • 1. US Banking Performance and Bonus Controversy
    Presented by:
    Praful Anchaliya

2. Primary roles of Bank
Goods and services
Central Bank
Depository credit intermediation
Industry organization
Commercial banks
Savings banks and savings and loan associations
Credit unions
Federal Reserve banks
3. Working Conditions
Hours
2008- A non supervisory works for 36.2 hours week.2008- 8% of employees, mostly tellers, worked part time.Support staff work a standard 40-hour week.
Work environment
Commercial and mortgage loan officers often work out of the office.
Safe Place to work
Some of employees are located primarily at the headquarters or other administrative offices.
4. Employment
Employment
2008- Industry employed about 1.8 million wage & salary workers
74 percent of jobs were in commercial banks
Mostly bank branch offices employed 38 percent of all employees.
5. Quarterly Net Income
6. Net Interest Margin
7. Factors of Change
8. Industry Consolidation Continues
9. Number of Banks Failure
10. Housing Inventories
11. Salaries and Bonus
12. Bonus facts
Citigroup, Merrill Lynch and seven other US banks paid $US32.6 billion in bonuses in 2008 while receiving $US175 billion in taxpayer funds under the Troubled Asset Relief Program
Citigroup and Merrill Lynch suffered losses of more than $US27 billion at each firm ,Yet Citigroup paid out $US5.33 billion and Merrill $US3.6 billion in bonuses.
Bonuses averaged $US160,420 for Goldman Sachs's 30,067 employees, compared with $US13,580 at Bank of America, employer of 243,000 people.
Bonuses averaged $US95,286 per employee at Morgan Stanley, $US61,017 at Merrill Lynch and $US38,642 at JPMorgan Chase & Co., which operates large retail and investment banking units.
13. Conclusion
Example:

  • In the case of Washington Mutual fund , the FDIC stepped in to secure the good assets and deposits, puts these assets into a new company and then sells off those assets to a stronger financial institution.

14. Washington mutals funds good assets and deposits were sold to Jamie Dimon of J.P. Morgan.