Oct. 12 (Bloomberg) -- JPMorgan Chase & Co.’s investment bank cut employee compensation 9.4 percent in the first nine months of the year to $6.98 billion as the division generated 7.1 percent less revenue.
The expense was enough to give each of the division’s 25,884 employees $269,703, according to figures posted today on the New York-based company’s website. For the same period last year, the unit set aside $7.71 billion to pay traders, dealmakers and other personnel, or $289,611 for each of the 26,615 people on staff as of Sept. 30, 2011.
The world’s biggest banks are cutting costs as concerns that the global economy will slow limit revenue growth and new capital rules depress returns. Mike Cavanagh and Daniel Pinto were placed in charge of the investment bank in July, along with the firm’s corporate bank and treasury and securities-services units, replacing Jes Staley.
The bank set aside $2.07 billion in the third quarter to pay investment-bank employees, or 33 percent of that division’s revenue. JPMorgan’s investment bank had 669 fewer people than at the end of the second quarter, according to today’s disclosure. The staff companywide contracted 1 percent to 259,547.
Pay costs for the first nine months of the year were 34 percent of revenue at the investment bank, down from 35 percent in the same period a year earlier.
The amount set aside for compensation includes salaries, bonuses, benefits and the cost of deferred pay from previous years. Figures for average pay don’t represent what any employee actually receives and are calculated by dividing the total compensation expense by the number of employees.
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