November 13, 2001
Credit Suisse Trims Compensation of More Top Bankers
By PATRICK McGEEHAN
nytimes.com
In a continuing effort to bring employee costs at Credit Suisse First Boston in line with those at other Wall Street firms, John J. Mack, the new chief executive, has done away with special, lucrative compensation deals for Frank Quattrone and many other senior investment bankers, people close to Mr. Mack said.
Getting concessions from Mr. Quattrone, who oversees the technology investment banking operations on the West Coast, and his team of about 300 has been a priority for Mr. Mack since he joined First Boston, the investment banking unit of the Credit Suisse Group (news/quote), in July.
The technology group has operated too independently for Mr. Mack's taste, guaranteed a share of the revenue it generated so that its members could earn large sums even if the firm was less profitable than its competitors.
The agreement also signals that Mr. Quattrone, one of the world's best-known and most powerful investment bankers, will not be leaving the firm, as some observers had predicted.
Mr. Mack was also said to be close to signing an agreement with Jack DiMaio, a senior executive of the firm's bond business, that would change how he and about 250 people in his group are paid.
Mr. Mack's predecessor, Allen Wheat, had guaranteed $300 million in pay to Mr. DiMaio and about 40 other bond group executives last year. Another 200 members of the group had an arrangement to draw bonuses from a separate revenue pool.
Together, the revised pay plans — which would eliminate special multiyear pay for certain groups within the firm — could save First Boston about $300 million over three years, people close to Mr. Mack said. Late last month, Mr. Mack received pay concessions from a group of about 100 investment bankers that company officials said could save the firm as much as $70 million annually.
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Neither Mr. Quattrone nor Mr. DiMaio could be reached for comment yesterday. |
