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PAY NEWS

Merrill wasn’t going to pay too badly

16 October 2008

COMMENTS

My knowledge as a former ML employee for 3 years about Merrill's pay is that they pay good only the "top performers" (not necessarly selected on a meritocratic basis) and then a good 40-50% get very low bonuses... really really lower than IBK boutiques (5%, 10%, 15%, I mean).  Read all comments »

Until it stumbled into the arms of Ken Lewis and his campaign to curb the excesses of Wall Street, it would appear that Merrill was actually planning to reward its people quite well this year.

According to one of our ever popular estimations of average compensation, mean pay at Merrill was due to be marginally higher in 2008. The bank’s Q3 results indicate that average comp per head was coming in at $183k for the first nine months, compared to $180k for the same period last year.

This isn’t too bad when you consider that Merrill went out of its way to maintain bonuses in 2007. Last year compensation and benefits at the bank totaled $15.8bn, despite losses of $8bn. This was only marginally down from 2006, when payouts reached a record $16.9bn.

Whether pay continues to hold up will depend on compensation expenditure in the fourth quarter now that Merrill is one with BofA. Lewis’s comments suggest the average Merrill banker could be disappointed yet.

COMMENTS

M&A, Investment Banking / M & A,  Thu 16 Oct 08

My knowledge as a former ML employee for 3 years about Merrill's pay is that they pay good only the "top performers" (not necessarly selected on a meritocrastic basis) and then a good 40-50% get very low bonuses... really really lower than IBK boutiques (5%, 10%, 15%, I mean).

But on newspapers and (don't know why) always on this efinancialcareer web site, you will always read that ML pays to everybody the level it actually pays only to the top performers, and you never see the numbers payd to the lower performers (50% of the people working there 24/7)...

Unfortunately, is difficult to get access to the real figures that in my opinion are always 50% down of what you read here or other news providers (it's all based on a business rationale, forget the truth)

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Sarah, Editor, eFinancialCareers, HR & Recruitment,  Thu 16 Oct 08

M&A- We're not saying that Merrill pays everyone $180k - but that this is the mean amount for individual compensation at the bank. This is the only information that ML (and other institutions) make publicy available. Any additional detail on the distribution of compensation is necessarily anecdotal, which is not to say that we're not interested in it.

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Donald Duck, Hedge Funds,  Mon 20 Oct 08

"Any additional detail on the distribution of compensation is necessarily anecdotal ".
Sarah sorry : If publishing statistics, you can't say such things. If data are biased, they don't have much (not to say : any) statistical significance. Now I am certainly not discussing the figures you gave or what M&A claims instead....But just that if you produce statistics : they must have a statistical significance and must have been adjusted for their bias...otherwise : void, useless, pointless, etc....whichever term you want to use. You have to deal with the extremes.

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Sarah, Editor, eFinancialCareers, HR & Recruitment,  Mon 20 Oct 08

Donald - they're relevant to the extent that they show the mean and that this is statistically comparable between one year and the next. In my (totally humble) opinion, trends in mean pay per head are interesting as they provide an indication of the overall direction of individual bonuses at particular organisations over time.

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