NEW YORK — Citigroup and Merrill Lynch lost more than $55 billion combined last year, adding to the massive wreckage on Wall Street that took the nation's financial system to the brink of collapse.
Yet they were among nine big banks that combined paid out more than $32 billion in bonuses -- even as the banks took in $175 billion in taxpayer aid to weather the storm, according to an analysis that provides one of the most comprehensive looks ever at Wall Street pay.
Nearly 5,000 people received bonuses of $1 million or more amid the worst financial crisis since the Great Depression, according to the report by the New York attorney general's office, released Thursday.
"When the banks did well, their employees were paid well," the report said. "When the banks did poorly, their employees were paid well. And when the banks did very poorly, they were bailed out by taxpayers and their employees were still paid well."
New York Atty. Gen. Andrew Cuomo launched the compensation study as part of a larger review of the causes of last year's financial crisis. Wall Street's pay structure is seen by many as a leading culprit, encouraging traders to make risky bets to earn lavish bonuses.
To help rein in such practices, the Obama administration has proposed a pay reform bill that goes to a vote in the House of Representatives today.
If any more public outrage is needed, the Cuomo report supplies it. It notes, for example, that Citigroup Inc. and Merrill Lynch & Co. paid out nearly $9 billion in bonuses combined despite their huge losses and also received $55 billion in federal bailout money.
At Goldman Sachs Group Inc., which had the highest average pay at slightly more than $160,000 per employee, the top 200 earners took home bonuses of almost $1 billion combined. The top 14 people got more than $143 million, and 212 got $3 million or more each.
Wall Street defended its steadily rising pay throughout the bull market by saying it was linked to firms' ballooning profits.
From 2003 to 2006, for example, compensation at Bank of America Corp. soared from $10 billion to more than $18 billion, the report noted.
"Yet, in 2008," it said, "when Bank of America's net income fell from $14 billion to $4 billion . . . compensation payments remained at the $18-billion level."
Rep. Edolphus Towns (D-N.Y.), who is investigating the $700-billion Troubled Asset Relief Program, created to bail out the financial industry, called the findings "shocking and appalling."
