Oct. 27 (Bloomberg) -- CLSA Asia-Pacific Markets, the regional brokerage unit of Credit Agricole SA, asked 500 senior bankers and executives to accept pay cuts of as much as 25 percent next year to avoid getting rid of jobs.

The voluntary salary reduction program that was proposed for one-third of the staff last week would reduce basic pay by 15 percent to 25 percent starting in January, according to Chief Executive Officer Jonathan Slone. The participating employees would be paid the salary they forgo and may also receive a bonus payment when profit meets certain targets, he said.

Slone is seeking to cut costs as trading volumes tumble amid the global financial turmoil that may force Goldman Sachs Group Inc. to fire 10 percent of its staff. The proposed pay cut package is similar to the one offered by CLSA in 2003 when the severe acute respiratory syndrome led to faltering economies in Hong Kong and China.

``We think it's the right way to keep our team intact, maintain client service and allow us to expand our offering during a difficult time,'' Slone said in an interview. ``We face challenges like this crisis as a team and when conditions turn, we all share in the benefits as well.''

The world's largest banks and securities firms are slashing costs to survive a global credit crisis that has led to the bankruptcy filing of Lehman Brothers Holdings Inc. and emergency takeovers of other U.S. and European companies. The financial- services industry worldwide has cut more than 140,000 jobs since July 2007, following the collapse of the U.S. subprime mortgage market.

Cost-to-Income Target

The MSCI Asia-Pacific Index dropped 7.5 percent last week, extending its decline for the year to 49 percent as it heads for its worst annual performance on record.

The company will pay participating staff the salary they sacrificed and at least an additional 8 percent of their basic compensation each month if the cost-to-income ratio can be kept at or below 50 percent, said Hong Kong-based spokeswoman Simone Wheeler.

Those who take a 20 percent or 25 percent cut will get 17 percent or 25 percent in additional income respectively, she said, adding that employees who don't participate in the pay-cut plan won't lose their jobs.

``Our current ratio is quite close to the 50 percent level and we are currently lowering costs further,'' Slone said. ``I think this target can be reached or we would not have used it.''

Slone said he doesn't expect a return to ``normal'' market conditions for some time and the current crisis is more severe than 2003 because it's more global and not limited to Asia.

``The decline of global growth has a far greater impact on underlying business conditions than did SARS,'' he said.

To contact the reporter on this story: Cathy Chan in Hong Kong at kchan14@bloomberg.net

Last Updated: October 26, 2008 21:37 EDT