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Exact(15)
He believes that the government should legislate to bring compensation ratios down.
Their reward models have left the banking sector with "compensation ratios" – the proportion of revenues paid out to staff – commonly as high as 40%.
So cost-cutting is much more important than it was: compensation ratios at investment banks have fallen (chart 5).
The compensation ratios are hard to evaluate because this year's payouts include the deferred portions of previous years' awards, and include only the current components of this year's.
"We have high capital, and high human capital," he said, noting sarcastically that newspapers also often have high compensation ratios but "don't make any money".
They don't have large factories and huge raw material storehouses, so their compensation ratios tend to be higher than those in more capital-intensive industries.
Similar(45)
Now, however, the compensation ratio is expected to rebound somewhat.
The firm attributed the falling compensation ratio to its higher revenue.
One number that stood out in the institutional securities division was its compensation ratio.
The firm is aiming to whittle down its compensation ratio to the mid-50s percentage range.
The unit's compensation ratio fell to 41 percent from 43 percent in the period a year earlier.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com