Bank of America Corp. (NYSE: BAC) is reducing the amount of cash it pays out in bonuses to employees. According to Bloomberg News, employees are being told of the new bonus structure today.
BofA is following other big banks, including Morgan Stanley (NYSE: MS) and Credit Suisse (NYSE: CS), in capping bonus payments in an effort to reduce costs and conserve cash.
Employees at BofA will now be paid bonuses in a combination of cash, common stock, and restricted stock, with the proportion differing depending on the size of the bonus. In previous years, most employees received 60%-70% of their bonuses in cash. This year the bank will pay out 15%-20% in cash.