Double Dip Coming to Some Bear Staffers
Bear Stearns staffers are in the process of figuring out their future, but you do not have to be retained by JP Morgan to win.
I know of one employee who has averaged 250k at Bear over the past two years; he recently received his bonus and has a guarantee from Bear that will pay him 500k over the next year even though he is out the door.
Currently negotiating for a new position that will pay him around 400k, all in, he will approach his first million dollar year at age 30, not a bad deal all things considered.
Of course not everyone will make out like a bandit; but at least those who stay at JP Morgan now know where they stand:
JP Morgan will offer a three-year stock retention package to those Bear Stearns staff it wants to persuade to stay, based on their bonus for last year.
Most Bear Stearns staff will find out by the end of this month whether they will have a job with the combined bank, and those who are offered jobs by JP Morgan will receive packages that vest over the next three years, with 50% vesting after two years and the remainder after three.
Many of the staff at Bear Stearns receive a higher proportion of their bonus in stock than at other Wall Street banks, and the bulk of these payments will have been wiped out after the near-collapse of the bank and JP Morgan’s $10-a-share offer.
The details of the retention packages are contained in the internal merger document between Bear Stearns and JP Morgan, according to a person who has seen it.
The terms of the package are the same as those offered to the majority of JP Morgan staff as part of their share compensation and shows how fast the bank is moving to integrate its investment banking business with that of Bear Stearns.
Bear Stearns’ top-paid bankers who received over $5m (€3.2m) last year, are not covered by the offer and will, if retained, have to negotiate individual deals with JP Morgan.
According to a headhunter based in New York, some high-earning staff have been offered a so-called “cliff vest” that will only allow them to receive their shares after five years. The offer was a blunt attempt to keep the best performing staff at the firm, he said.
JP Morgan has already begun offering jobs to those Bear Stearns staff it wants to keep, and most employees will know by the end of the month whether they have a job or not. Those made redundant will receive nine months’ salary and one third of their 2007 bonus in cash.
Bear Stearns declined to comment. Financial News
Collecting two pay checks at the same time, the fabled double dip, is as good as it gets on Wall Street.
Gasparino on Bear Layoffs
JP Morgan offers three-year package to Bear staff
Financial News
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