The story comes from Julia Werdigier, reporting in the New York Times blog DealBook. According to the Times:
"The new rules would create 'greater transparency for all stakeholders' and reflect 'the bank's commitment to rewarding its employees for performing in a way that creates sustainable value for the bank and its shareholders,' Credit Suisse said in a statement.
Credit Suisse has its investment banking practice headquartered in London, where political pressure seems to be mounting on banks with regard to compensation.
Also from The Times:
"Prime Minister David Cameron of Britain said in an interview with the BBC on Sunday that banks 'should pay smaller bonuses' and be more 'socially responsible.'
It's difficult to gauge the precise impact of this breaking news. It seems reasonable, however, to say that Credit Suisse's investment banking practice does not exist in a vacuum. Lowering the thresholds of deferred compensation, and increasing deferred compensation percentages, will likely alter the political and economic landscape of London based investment banking to some greater or lesser extent.
Whether investment bankers will flee Credit Suisse in droves—or whether other investment banks will feel pressure to enact similar measures— remains to be seen.
Perhaps the larger question will be whether The City can remain a competitive location for investment banking operations to be headquartered in light of such political pressures
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