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THOUSANDS of IFSC workers are facing up to a grim January as the big banks cut back drastically on their bonus pools.
Most of the international banks with offices here hand out bonuses within the first fortnight of the year.
While the individual figures are miniscule compared to the multi-million payouts that are handed out in The City and Wall Street, staff are known to rely on the extra compensation and most budget for it.
Most Irish-based staff are employed in back office and administrative functions. That means they don't generate revenue for their firms and are seen as significantly less valuable than traders and dealmakers.
Even so, this year's windfalls are expected to be much worse than even last year. One staffer in Bank of America- Merrill Lynch, which employs nearly 2,000 people in Dublin, said staff bonuses there were expect- ed to be "brutal" this year.
Scandal The industry overall is dealing with shrinking revenue amid concerns about the state of the global economy, while several firms are caught up in investi- gations tied to the manipulation of the LIBOR interest rate, which has already resulted in fines worth hundreds of mil- lions of euro for institutions.
Yesterday it emerged that Royal Bank of Scotland, the par- ent of Ulster Bank, was cutting its bonus pool as it prepares to pay a fine of around £350m (€430m) for its role in the LIBOR scandal.
The state-owned UK bank is believed to be close to a settle- ment with authorities in the UK, US and Asia over its alleged role. Once that settlement is made, the bank has apparently told some employees that it will pay out far less in bonuses this year and may try to claw back bonuses paid in 2012, even if they were contractually required.
Barclays paid penalties worth some €330m tied to the LIBOR scandal earlier this year, while UBS is expected to settle with US regulators for around €750m.
Separately, the British bank HSBC has agreed to a €1.45bn settlement in the US for its alleged role in a money launder- ing operation.
