On Wall Street, there are bonuses but not the feeling.

Big bonuses on Wall Street this week come with a warning.

After the blockbuster year, the five largest investment banks will pay $ 142 billion in compensation by 2021, $ 18 billion more than 2020. The amount of money that is closely linked to how much money companies make on Wall Street has doubled. .

By JPMorgan Chase JPM 0.62%

& Co., Compensation for Investment Banks and Traders has increased by 13%, which is three times more than their extra income. Citigroup Inc

C 1.50%

Revenue is slightly lower than by 2020, but the company has paid its employees $ 3 billion more than it did a year ago.

Goldman Sachs team Inc.

G.S. 2.48%

According to insiders, he has given half a billion dollars in special dividends to his nearly 400 partners.

But in a meeting with executives across Wall Street, bank executives warned this week not to expect the same in 2022, saying U.S. stocks are off to a rocky start. The Federal Reserve is expected to raise interest rates several times this year, reducing investors’ interest in high-yield bonds, silicon valleys and other large-scale banks. Washington’s antitrust move could slow down its $ 13.5 billion merger last year for the three largest US banks alone.

Goldman executives have opted for a special bonus for partners – simply increasing their regular stock rewards – to wrap up the gift as a one-time event and move forward with their expectations.

Goldman, chief financial officer, told analysts on Tuesday that the company’s generosity was one-off, adding that “as the environment changes in 2022, the compensation model is highly volatile.

Even this year’s bonus day is over. Due to the epidemic, the banks’ offices were few and far between, and there was little evidence of a new spirit of joy or frustration among their employees. And while New York is still being silenced because of the Omicron differences, the cost of the celebration was less.

A year ago, banks were at the same high interest rate. But with the wage bill, many Americans lost their jobs or lives in the whirlwind of optimism that awaited the white supremacist workers who had left the countryside to measure their economic recovery.

In this case, companies are under pressure to share the wealth. Bankers look at their paychecks as their former colleagues and recent college graduates gain wealth in bitcoin, SPACs and meme stocks.

“It is shocking to see how hot the job market is,” said Allan Johnson, a consultant who helps financial institutions design their payroll programs. “You have crypto, you have tech,” he said, adding that the current “personal justice siren song” pays more than banks.

Michael Bussela, who left Goldman’s job in 2017 for BlockTower Capital, a crypto investment company, is reaching out to a number of former partners. “I’m like ‘Miami, let’s have dinner and by the way I think there are three job offers,'” he said. Crypto “offers a level of compensation and happiness that the banks cannot afford.”

Banks are trying.

Compensation in the top five companies has risen from 35% to 33%, which is about two years. This means that their bank employees, merchants, engineers, and portfolio managers have taken home an additional $ 9 billion that can be returned to shareholders or used for new loans or technology upgrades. Jeffrey gave his most junior staff a gift of choice, including a Peloton bicycle.

Goldman Sachs has awarded nearly 400 shares to special partners.

Photo die

Victor J. Blue / Bloomberg News

A.D. According to insiders, Goldman’s shares, which have a net worth of $ 59 billion by 2021, will wear off faster than the company’s basic dividends. This makes it more cost-effective and more competitive with the fairness of technology companies and some boutique banks.

Payments are made after a year of travel if the bank has a record income, but has caused significant burns among its employees. Mr Johnson said he had advised his clients not to wait for the flow of gratitude.

“No matter how much you pay them, they believe they deserve more of all the stress they have gone through,” he said.

According to a source close to JPMorgan, the bonus pool for investment banks is about one-third higher than by 2020. Stockholders received higher payouts after years of enrollment in the trade, and bonuses for steady-income traders were generally higher than by 2020.

JPMorgan also this week raised wages for the second time in seven months for its young workers, a wage that equals its wages. First-year bankers now earn $ 110,000 a year, up from $ 85,000 by early 2021, according to one source. The Associates, which developed the next ladder, and especially in its three years of operation, this week earned $ 25,000 to $ 175,000.

Write Liz Hoffman at liz.hoffman@wsj.com and David Benoit at david.benoit@wsj.com

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