Bankers rap low bonuses...and buy their next Patek

By Olesya Dmitracova and Michael Taylor

LONDON (Reuters) - As London's financial district is dishing out bonuses from a much smaller pot this year, some aggrieved bankers are set to quit and others are seeking legal advice, but most go on spending like there is no tomorrow.

Losses stemming from risky mortgage businesses in the United States and a slowdown in deal-making due to a global credit crunch have depleted the pools of cash banks use to reward staff for a year's work -- and to show how much or how little they think of a banker's performance.

The bonus season runs from December to April, with most European banks allocating the "golden thanks" in February.

For some, bonuses are down by as much as three quarters compared to last year, and Britain's Centre for Economics and Business Research predicts at least a 16 percent drop in bonuses across the board.

"It's being used as an opportunity to send a very strong message to those people who are just not cutting it," said a London-based investment banker.

City bonuses range from around 100,000 pounds ($195,000) for analysts and traders to several million pounds for senior bankers. A standard perk is at least as big as the basic salary and in a good year the basic salary makes up for only 10 to 20 percent of the total remuneration.

THERE WILL BE BLOOD

Merrill Lynch & Co Inc said last month that its top executives did not receive bonuses for 2007 after the world's largest brokerage posted $12 billion in net losses during the second half of the year.

Not everyone is taking such news well.

One Swiss derivatives trader told Reuters he had decided to quit, taking his cue from some of his colleagues, after being paid an unchanged or smaller bonus than last year.

In a recent poll of 1,874 City professionals by global financial careers Web site eFinancialCareers.com, more than half said they would look for a job at another bank if they were unhappy with their year-end bonuses.

Some of those reluctant to walk due to market uncertainty and a scarcity of jobs, are turning to lawyers.

Richard Linskell, an employment partner at Dawsons LLP, said he had seen a rise in the number of financial professionals seeking advice about their lower-than-expected bonuses.

"Employees can bring a claim against their employer on the basis that the bonus decision was irrational or capricious," he said.

BIG SPENDERS