UAE bankers will see their bonuses for 2009 (payable in 2010) hammered by the credit crunch, with an expected 40 per cent cut when compared to 2008.

Fixed-income bonuses will be particularly hit and focus will be on well-performing departments and retaining valued talent, instead of an across-the-board incentivisation plan.

"Bankers are being realistic this year, acknowledging any bonus is to be significantly smaller than in past years. The large payouts we have seen previously are history in 2009. Of course, there will always be exceptions. Banks in general do not only pay bonuses based on the performance of the banks' financials [although it is a big factor] but also due to other reasons, such as retaining the good staff they have.

"The amount of bonus to be paid this year will be 40 per cent less than last year," Adel Al Alawi, CEO of GulfBankers, told Emirates Business.

Panos Manolopoulos, Managing Partner Middle East at Stanton Chase, also believes we may see a 30 to 40 per cent drop in bonuses, adding, "bonuses have been drastically cut and reviewed from scratch. However, there are some cases in middle management positions that are fully justified, therefore, they will be given bonuses. After all, the year has not ended yet and there are some interim bonuses for short-term achievements. In principle, we will see a decline in bank bonuses in 2009 and the trend will continue in 2010 despite a possible recovery."

Peter Greaves, Director, Head of Financial Markets at McArthur Murray, believes some would be rewarded, while others would be left out. "In general, no [bonuses]. That said, the good ones, yes. It should be about rewarding those who achieve and about retaining quality talent. I was never a buyer of 'bankers' bonuses will disappear'. I do believe there should be correlation between originating deals, achieving targets and bonus versus happy clients," he said.

Hasnain Qazi, Middle East Business Manager at Pathway Resourcing, too expects a big dip in bankers' bonuses.

"It is difficult to gauge the exact figure but we are looking at anything between 40 per cent and 70 per cent," he said. The departments that have been at the forefront and have performed strongly are expected to reap the benefits.