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Banking, finance, and taxes

With Pay Cap Restrictions Faltering, Will Talent Return To Wall St.?

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By Douglas A. McIntyre Updated Published
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Wall St. firms and the large money center banks with investment and M&A arms have continued to insist that their best talent will head to private equity firms and hedge funds as opportunities for multi-million dollar paydays disappear. The notion was probably flawed from the start. The number of people who work at private financial firms is fairly small. They certainly cannot grow enough to handle a mass exodus of Wall St. talent.

The best bankers may decide to stay at the large financial firms. The payback of TARP money by 10 institutions will get them out from under the most onerous compensation provisions. According to the The Wall Street Journal, the Administration is backing off some of its most draconian base pay and bonus cap programs. New restrictions on compensation “will likely come in the form of recommendations”, the paper reports. When huge bonus packages are at stake, recommendations mean nothing.

The Administration will probably still appoint a “pay czar” who can examine compensation of bank executives and traders, but keeping track of thousands of investment experts, money managers, and M&A players will be nearly impossible. Now that the government is beginning to back down on the pay issue, banks will try to circumnavigate whatever weak provisions remain.

Big pay is back on Wall St. Bonus payment for 2009 should return to “normal.”

Douglas A. McIntyre

Photo of Douglas A. McIntyre
About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.

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