NEW YORK - Ferrari dealers get ready: Wall Street bonuses are in, and they are big.
Alan Hevesi, the New York state comptroller, announced Wednesday that Wall Street bonuses are estimated to hit a record $21.5 billion for 2005, surpassing the previous record of $19.5 billion, set in 2000. Those bonuses were driven by record profits at many of Wall Street's major investment banks, including Goldman Sachs, Bear Stearns and Lehman Brothers.
The average bonus of $125,000 was also a record, surpassing the previous high in 2004, of $114,270.
Hevesi's figures represent bonuses awarded at 220 New York Stock Exchange-listed companies. Adjusted for inflation, the 2000 record was $22.3 billion.
The benefits, while widespread, will not be shared equally.
"When the tides come in, all boats rise," said Alan Johnson, managing director of Johnson Associates, the compensation-consulting company. "Thousands make $1 million or more, and then there are lots of people who get $10,000. Everyone gets something, but it is by no means equitable."
Wall Street chief executives will be at the top of the heap.
Henry Paulson Jr., chief executive of Goldman Sachs, earned a compensation package of $38 million for 2005. Richard Fuld Jr., the chief executive of Lehman Brothers was awarded $14.9 million in restricted stock. John Mack, who took over at Morgan Stanley last summer, was paid $11.5million for six months' worth of work.
While most Wall Street executives, bankers and traders have now been told what bonuses they are getting, they will not be receiving the cash or stock until the end of January or February.
Nonetheless, some will have already budgeted or spent their bonuses. Multimillion-dollar estates, rare art, luxury cars and fractional shares in private jets are among the more popular items coveted by Wall Street's masters of the universe.
Performance on the Street varied among the companies last year, but the underlying business of trading, lending, advising and raising money for companies was robust overall.
About $1.8 trillion in mergers and acquisitions were completed in the fiscal year ended in November, according to estimates by Merrill Lynch. That compares with $1.3 trillion in 2004.
The bulk of Wall Street's profits continue to come from trading, with an increasing amount coming from companies using their own money to try to make bets rather than simply acting as an agent between parties trading.
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