Street Giants Slash Pay Bowing To DC Pressure

Goldman Sachs, Morgan Stanley, and JPMorgan Chase have all revealed major cuts in executive compensation made in the fourth quarter of 2009 in what is widely considered a concession to mounting political pressure from President Barack Obama and other lawmakers, reports Bloomberg. The three firms allocated a combined total of $39.9 billion in pay for 2009, which fell short of earlier estimates for a figure around $46.1 billion as well as the record high set in 2007, when the firms doled out $44.7 billion.

Goldman Sachs slashed $519 million from its compensation pool in the fourth quarter, which brought the total annual pay costs to $16.2 billion or 36 percent of revenue - a record low since the company went public in 1999. Goldman put aside $500 million dollars for charitable giving.

JPMorgan cut 80 percent off third quarter investment bank compensation last quarter, setting aside $549 million for pay. The total investment bank pay for 2009 was $9.33 billion. Meanwhile, Morgan Stanley paid out a total of $14.4 billion in 2009, less per employee than in 2007, thanks to the addition of 15,000 new staffers in June.

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