Sure they could. To put it in perspective, thousands of companies are unable to pay their employees and vendors this week due to the SVB collapse.
It does not seem unreasonable that SVB employee bonuses for "great job done in 2022" should have been delayed given the clear evidence on Thursday that the bank was imploding.
Q1 is a common time to pay out last year's bonuses. And TBH, I don't think most of the bank workers share any blame for SVB collapse, and they did work the whole 2022 so I don't think it would be fair for them not to get the bonuses they earned. And given that they'll find themselves out of a job very soon, I don't think it's a bad thing - at least they have some cushion while they're looking for the next job. I mean, if we're talking about C* suite, they probably didn't really deserve any bonus, but if we're looking at line workers in the branches, it's not their fault somebody made mistake with investments.
Bonuses are often calculated months in advance, and employees are also normally told about them weeks or more before they are paid (they're often even in contracts).
Despite the guy on Twitter calling the SVB issues in January, and arguably long term mismanagement that led to the downfall, the actual issues happened rapidly, over a matter of days.
These just didn't happen on the same time scale, and bonuses can't be undone in a matter of days with employees expecting them and even contracts demanding them.
There's a lot of reasonable takes on this whole terrible situation, but implying or suggesting that the bonus payouts were part of it or that employees are to blame for taking them is a terrible take.
SVB had a bonus schedule like every other company, and paid out those bonuses to all eligible employees. The payments were for work done in 2022. There is literally nothing to see here.
From the headline I thought maybe they had accelerated the bonus payout schedule to squeeze money out of the company before the collapse, but the article says it was scheduled long ago:
> What to know: The bonuses were for work done during 2022, and were previously scheduled to be disbursed on March 10. That date ultimately coincided with the bank's takeover by the Federal Deposit Insurance Corporation.
Furthermore, bonuses that were scheduled later in the month weren't paid out:
> Bonuses for employees in some other countries were scheduled for later in the month, so those haven't yet been paid.
So while the headline sounds bad and is likely going to generate outrage, this really just reads like normal payroll processing was happening on schedule.
Note that payroll would have been coming out of a completely different bucket (e.g. not from customer reserves) and would have been submitted for processing prior to March 10th in order to be disbursed on March 10th. Also note that bonuses are an integral part of compensation, so withholding already-earned compensation from regular employees (the majority of which had nothing to do with the collapse issues) is an unreasonably punitive idea.
So basically, the timing was coincidence unless someone can come up with some weird evidence that bankers delayed the collapse just long enough to get their bonuses, which seems far fetched. The collapse was triggered when they ran out of liquidity due to customer actions, which they couldn't have prevented.
There's a similar outrage-bait story circulating about executives selling stock prior to the collapse, but that was also pre-scheduled sales that were planned long in advance.
While the fact that the bonuses were paid at the time does help underscore the level of malfeasance of the bank leadership, many of those receiving the bonuses probably didn’t know about the gaps.
No-one could have predicted this pandemic and the drastic measures companies have to take. When they paid the bonus they had no idea they would have to cut salaries a few months later. The timing is essential since one event happened before the pandemic and one afterwards. We could argue about bonuses in general but that's a whole different topic.
I can certainly understand that maybe the salaries should not be claimed back, for for sure the bonuses must be given under some condition that if the bank/company fails within X years of receiving it, the bonuses should be returned in full, otherwise there is simply no responsibility for carelessness.
That’s not how bonuses work. I think it is entirely reasonable to give employees extra, unexpected and non-compulsory payments of some large fraction of whatever real money they demonstrably saved the company.
It's a tough one. On the one hand it's easy to get bitter about these bonuses. On the other hand the banks will lose people who (despite the mistakes they've made) are the most experienced in their fields when it comes to handling the banks and won't be able to attract staff of any quality without the bonuses as it's a systemic issue.
On the other hand as other smart people on this site have pointed out, where the government has lended or invested it should have a say in the decision.
Personally I'd be happy to let them have their bonuses providing their balls were strapped to a device that checks the stock price every 30 seconds and administers electric shocks when the share price drops below a certain level. If they manage to make it through the year without singed balls or resigning from the pain, I think they might deserve the bonus.
It's not "parasitic," it's an incentive structure. Bonuses are standard practice in the financial sector intended to reward high effort and good performance.
Unless you believe nearly every employee at SVB down to the entry level is in some way responsible for this, then complaining about bonuses doesn't make any sense.
For the record, I don't think they should be bailed out.
This doesn't say "executive bonuses." I would not be surprised if SVB employs customer service teller-type-people making $60k/year with an annual $5k bonus, and this headline would be consistent with such people getting their scheduled bonuses paid on time. The headline says nothing about what the compensation level or responsibility of the people getting paid bonuses was.
Maybe and the point about bonuses is so sadly true, but then they are never negative when things fail, maybe they need to swing both ways in such positions and install a truer sense of accountability.
Perhaps another way of implementing that would be that bonuses are held in escrow for a number of years, the employee is allowed to get interest free loans against those escrow bonuses up to a point perhaps, yet those bonuses will equally be open to adjusting for bad years.
Which reminds me of the reinsurance industry and names, those who invest. Even when they leave, they are still liable for future claims for a number of years, a notice period. That's fair and works.
> The Swiss government has banned Credit Suisse from paying deferred bonuses awarded before 2022 in a move that has sparked more upset from staff at the failed bank
Maybe I am a bit suspicious due to what has happened in "high finance" for the past decade or 2, but that statement indicates to me it is the "regular" employees that will loose their bonus. What about the upper-level execs who probably have an employment contract. Will they loose to ?
It does not seem unreasonable that SVB employee bonuses for "great job done in 2022" should have been delayed given the clear evidence on Thursday that the bank was imploding.
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