Bonuses back

With no major reports on U.S. economic data set for release Friday attention turned to a new report by Kenneth Feinberg on big bank bonuses.

In addition to being the independent administrator for BP oil spill claims, Feinberg is the Obama administration's special master for executive compensation, a job he took to set pay for the top executives of troubled banks bailed out by the federal government.

In a report being released Friday, the federal authority on bank compensation was expected to conclude that nearly 80 percent of the more than $2 billion in bonuses and other payments doled out to high-flying bank executives at 17 institutions in late 2008 was unmerited, The New York Times reports.

Those institutions under scrutiny include giants like Goldman Sachs, JP Morgan Chase, Citigroup, CIT and AIG. The Times says Feinberg has little political leverage other than informing the public to try to shame the bankers into voluntarily giving some of the money back.

If the amount in bonuses paid out in the second half of 2010 is similar to what was paid out during the first six months, Wall Street bonuses could approach 2007 levels, as they were right before the financial crisis and recession began, the Times said.

"It's healthier than I would have ever expected a year ago," compensation consultant Alan Johnson told the newspaper about banker pay.

After lengthy debate late Thursday night, the Senate voted 60-37 to end debate on a proposed $30 billion lending program for community banks to help small business. Republican Sens. George LeMieux of Florida and George Voinovich of Ohio joined Democrats to end the chance of a GOP filibuster even though their fellow Republicans called the measure a smaller version of the Troubled Asset relief Program that bailed out large U.S. banks.

"This is something that we want to do to help Main Street, to help small business," said Sen. Mary Landrieu (D-La.) chairwoman of the small-business committee. "This isn't about Wall Street. It's not about bailouts. It's not about troubled assets. It's not TARP. It's a small-business lending fund, a strategic partnership with community banks."

The Senate will take up the bill again next week with votes expected Tuesday, The Hill reported.

With polling numbers for both President Obama and Congress falling, the president Thursday signed a bill requiring federal agencies to cut waste by clamping down on improper payments, and the House voted 272-152 to approve extended unemployment benefits for 2.5 million workers through November.

In international markets Friday, the Nikkei 225 index in Japan rose 2.28 percent and the Hang Seng index in Hong Kong rose 1.1 percent. The Shanghai composite index in China rose 0.38 percent.

The S&P/ASX in Australia was up 1.91 percent.

In midday trading in Europe, the FTSE 100 in Britain was off 0.27 percent while the DAX 30 in Germany rose 0.11 percent. The CAC 40 in France was up 0.44 percent while the pan-European DJ Stoxx fell 0.09 percent.