Investment Banker Hambrecht Plans to Cap Salaries at $60,000
With the stock market in turmoil, high-tech investment banker WR Hambrecht & Co. said Tuesday that it is imposing a $60,000 salary cap, effective Oct. 1.
About half of San Francisco-based Hambrecht’s 170 employees make more than $60,000 now, said spokeswoman Sharon Smith.
The closely held company doesn’t disclose top executives’ salaries, but investment banks and stock brokerages typically pay their leaders and research analysts well over $100,000 annually.
In recent years, bonuses have exceeded the salaries of top-performing employees in the securities industry. Hambrecht is eliminating its bonus pool as part of its new compensation system and replacing it with a revenue-sharing plan.
If the brokerage’s revenue remains at recent levels, many employees will make up for their salary losses, Smith said.
By adopting the new plan, though, Hambrecht is acknowledging that its fortunes might slip even further in the aftermath of last week’s terrorist attacks that jarred an already shaky stock market.
“We want to stay in business, and this seemed like the best alternative,” Smith said. Hambrecht, founded in 1999 by Silicon Valley financier William R. Hambrecht, is trying to change the investment banking industry by offering shares of initial public offerings in online auctions. Its best-known online IPOs include online magazine Salon.com and Peet’s Coffee & Tea.
