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(Reuters) - Wall Street paid out $20.3 billion of bonuses in 2009, up 17 percent from a year earlier, New York State's comptroller said, as the financial industry recovered fitfully from a near meltdown.
Speaking on CNBC television, Comptroller Thomas DiNapoli said profit for all of Wall Street could top $55 billion for 2009, when the economy began to stabilize and as lenders raced to repay federal bailout money they had come to view as a stigma.
Average taxable bonuses on Wall Street rose to $123,850 in 2009, he said. Compensation at Goldman Sachs Group, J.P. Morgan Chase and Morgan Stanley, three of New York's biggest banks, rose 31 percent, DiNapoli said.
The comptroller's annual report on Wall Street pay is closely watched not only by Wall Street but also by politicians eager to rein in runaway pay in a still-weakened economy where unemployment remains high and tax revenue remains depressed.
While bonuses are well below the level set in 2007 and are now more closely tied to company performance, DiNapoli acknowledged that many might consider them outsized given the lingering problems in the economy.
"It's still a bitter pill for many people," he said.
Taxpayers
in 2009 rescued the U.S. banking industry with hundreds of billions of
dollars in bailouts, putting into focus pay practices on Wall Street
banks.
As a result, President Barack Obama appointed a "pay
czar" who had the authority to rein in pay at firms that received
extraordinary bailouts.
The public outrage over pay also
impacted the pay practices at some banks, even after they had paid back
the taxpayer bailout. The anger stemmed from the quick return to
profitability and large bonuses so soon after the bailout.
Wall
Street's dominant bank, Goldman Sachs, for example, did not give out
any compensation in the fourth quarter of 2009, and instead made a $500
million charitable contribution. The firm earlier was on pace to pay
out more than $20 billion in compensation, shattering its record from
2007.
Banks have also changed their compensation structures to
pay employees in stock that must be held for multiple years, a move
designed to curb risk-taking for short-term gains.
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