Who was paid down in the most recent bonus round? It wasn’t the juniors. The 2018 investment banking division (IBD) salary and bonus review from London recruitment firm Dartmouth Partners suggests pay for analysts and associates at most banks is up between 5% to 10% on last year, albeit with greater banding on the basis of performance for people at senior associate level and above.
“The disparity in bonuses between top and bottom paid individuals has widened across the mid to senior levels,” says Logan Naidu, Dartmouth Partners’ CEO. “Top performers are receiving a disproportionate amount, with the lion’s share going to outperformers.”
Dartmouth’s 2018 survey suggests you can now expect to earn an average of £72k ($101k) in total compensation (salary AND bonus) in your first year in M&A or capital markets at a major bank in the City of London. This rises to £329k ($462k) ten years later, as per the chart below.
Some banks, however, pay more than others. And the highest payers aren’t necessarily the banks you’d expect. We’ve broken out salaries and bonuses on a bank-by-bank basis in the table below. The most notable features are as follows:
• U.S. banks consistently pay more than Europeans, with BAML consistently among the top payers for all junior ranks.
• UBS pays particularly well for a European bank.
• Rumours of poor IBD bonuses at Credit Suisse seem to have been greatly exaggerated at junior levels – the bank paid very well.
• Barclays paid its juniors comparatively poorly for last year.
Despite UBS’s generosity, Naidu said not everyone there is content: “We’ve observed a rise of dissatisfaction at Morgan Stanley and UBS.” This contrasts with ‘general happiness’ at BAML, J.P. Morgan and Goldman Sachs.
Junior bankers who are unhappy with their lot have plenty of options. Naidu says the hiring market is, “hotter and fiercer” than ever as both banks and private equity funds compete for talent.
The charts below apply to the most recent bonus rounds at the banks concerned. However, not all banks pay junior bonuses in January, as reflected in the accompanying notes....MUCH MORERelated:
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