Credit crunch to shrink '07 City bonuses

The centre for economics and business research(cebr) found 2007 bonuses, to be paid at the start of 2008, will reach just £7.4bn - well below the record £8.8bn paid out in 2006. Its bi-annual London and the City prospects report found City firms are looking to cut costs and the easiest way to do so is to make smaller payouts. Investment banks and hedge funds will lead the cuts, given their highly incentivised schemes, with payouts in traditional areas such as securities remaining largely unscathed. The forecast is also not good for 2008 bonuses with cebr suggesting payouts will fall ...