UK
2,500 Lehman jobs safe, rest are gone (UPDATED)
24 September 2008
Some Lehman bankers can now breathe easily. In a conference call with journalists yesterday, Sadeq Sayeed, senior adviser to Nomura's board in Japan, confirmed that the Japanese bank is buying Lehman’s equities (including equity derivatives) and advisory businesses, and will be keeping 2,500 staff across London, Europe and the Middle East.
Given Lehman employed around 4,500 people in London alone, jobs will clearly be eliminated in the bank’s large fixed income division, leaving at least 2,000 people with little in the way of a severance package and what looks like a much reduced pension. Employment lawyers say they’ve already had calls from Lehman employees who’ve been left with nothing, but that there’s not much that can be done if their unit is going into administration.
“If you’re not in a unit that’s being bought out, you have very limited rights,” says Jane Mann, employment partner at solicitors Fox Williams. “As an employee, you are a preferred creditor up to £800 and you have a right to redundancy pay from the government.”
Bonuses better under Nomura
Lehman bankers who get taken up by Nomura may end up substantially better off this year than if Lehman hadn't gone under. According to the Financial Times, Nomura has created a $1bn bonus pool for all its new staff.
Our research suggests that Lehman's own bonus pot for Europe and the Middle East was looking fairly diminutive.
In its last 10k filing in May 2008, Lehman said the total amount allocated to variable pay (AKA bonuses) was down 34% for the first six months of this year on the $2.9bn it allocated for the comparable period of 2007.
With EMEA generating only 9% of revenues in the first half of 2008, a proportionate allocation of bonuses suggest EMEA’s 5,000 staff would have received a mere $159m between them for the first six months of this year.
£8bn, surely not!! Printer's devil
krusty 23 Sep 2008
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