STOCKHOLM, Jan 28 (Reuters) - Nordea, the Nordic region's biggest bank by value, announced on Thursday plans to pay staff $384 million in 2009 bonuses and defended the move as necessary due to tough international competition.
The decision comes a day after Swedbank, Sweden's fourth-largest lender, told most employees they would not be paid bonuses following a year of heavy losses for the bank due to recession in the Baltic region.
Banks around the world are under intense scrutiny as they head into one of the most controversial bonus seasons of recent years and following the worst financial crisis in decades.
Nordea Chairman Hans Dalborg and Chief Executive Officer Christian Clausen defended the green light on bonuses this year, saying it would have trouble retaining top staff without the payouts.
'These are high numbers, but they must be seen in light of our operating profit of over 30 billion (crowns),' the two wrote in an article in Swedish paper Dagens Nyheter.
Unlike loss-making Swedbank, Nordea made an operating profit of 2.5 billion euros, or roughly 26.6 billion crowns, in the January-to-September period last year. The bank will announce its full-year results on February 10.
'It is the board and management's assessment that we have gone as far as we can to limit our bonuses without compromising our business model and operations,' the two wrote.
The Swedish government has taken a tough stance on financial firms, threatening stricter rules on bonuses if they fail to show restraint as they start detailing their bonus schemes for 2009.
But after a year in which some of the banks' risk-takers actually generated strong profits, banks may find it difficult as they try to retain staff and at the same time address public anger over what may be seen as lavish payouts during difficult times, analysts say.
Sweden's financial watchdog introduced delays for portions of the bonus payouts for bankers involved in risk-related activities. Swedish banks have not yet said how the rules will be addressed in their policies.
(Reporting by Mia Shanley; Editing by Jon Loades-Carter) Keywords: NORDEA/BONUSES (mia.shanley@thomsonreuters.com; +46-8-700 1004) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
The decision comes a day after Swedbank, Sweden's fourth-largest lender, told most employees they would not be paid bonuses following a year of heavy losses for the bank due to recession in the Baltic region.
Banks around the world are under intense scrutiny as they head into one of the most controversial bonus seasons of recent years and following the worst financial crisis in decades.
Nordea Chairman Hans Dalborg and Chief Executive Officer Christian Clausen defended the green light on bonuses this year, saying it would have trouble retaining top staff without the payouts.
'These are high numbers, but they must be seen in light of our operating profit of over 30 billion (crowns),' the two wrote in an article in Swedish paper Dagens Nyheter.
Unlike loss-making Swedbank, Nordea made an operating profit of 2.5 billion euros, or roughly 26.6 billion crowns, in the January-to-September period last year. The bank will announce its full-year results on February 10.
'It is the board and management's assessment that we have gone as far as we can to limit our bonuses without compromising our business model and operations,' the two wrote.
The Swedish government has taken a tough stance on financial firms, threatening stricter rules on bonuses if they fail to show restraint as they start detailing their bonus schemes for 2009.
But after a year in which some of the banks' risk-takers actually generated strong profits, banks may find it difficult as they try to retain staff and at the same time address public anger over what may be seen as lavish payouts during difficult times, analysts say.
Sweden's financial watchdog introduced delays for portions of the bonus payouts for bankers involved in risk-related activities. Swedish banks have not yet said how the rules will be addressed in their policies.
(Reporting by Mia Shanley; Editing by Jon Loades-Carter) Keywords: NORDEA/BONUSES (mia.shanley@thomsonreuters.com; +46-8-700 1004) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
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