NEW YORK (Reuters) - Morgan Stanley said on Friday that it will pay more of its bonuses to employees upfront, and defer less, saying that now that the bank is on better financial footing, it can move its pay practices more in line with competitors.
The step will result in its fourth-quarter compensation increasing by roughly $1.2 billion.
The bank said in a filing with the U.S. Securities and Exchange commission that only around 50 percent of the bonuses Morgan Stanley employees are due in 2015 for their performance in 2014 would be deferred on average, down from an average of around 80 percent previously.
"Now that our business strategy is in place and the Firm's performance has stabilized, it is time to bring our deferral policy to an appropriate long-term level, in line with the rest of the industry," Morgan Stanley Chief Executive James Gorman said in a memo to employees that was reviewed by Reuters. Its contents were confirmed by a Morgan Stanley spokesman.
Morgan Stanley also said in the filing that the board's compensation committee approved a proposal that allowed outstanding cash bonuses that had been deferred to vest as of Dec 1.
The bank said that the board's decisions did not have an effect on individual pay levels, which will be determined by performance.
(Reporting by Peter Rudegeair; Editing by Bernard Orr)
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