Forecasts for 2015 Bonus Vintage


We have examined salary data from 3,600 professionals working in front office in IBD, FICC and equities in London for 2014.


Highlights:

  • Origination and advisory professionals have momentum: thanks to a strong year of dealmaking by M&A departments, trickling down to new issuance for DCM and ECM markets, we expect bonuses to be up by 25% on average
  • Equities bonuses should be in slight decrease: despite a satisfying year across many equity desks, especially in prime services, bonuses are expected to be unchanged to down slightly (3%), which is mainly due to losses in the equity derivatives market
  • Notable decline for FICC bonuses: affected by poor results on Rates, FX and emerging markets, FICC industry professionals will see there bonus melt away by 5%, but we expect Credit to stand out, having benefitted from new issuance in 2014

IBD Equities FICC 
 2014 2015E20142015E20142015E
Associate£36,000£45,000£24,000£23,000£41,000£38,000
VP£84,000£105,000£43,000£41,000£77,000£73,000
Director£120,000£150,000£160,000£155,000£150,000£142,000
MD£158,000£198,000£178,000£172,000£290,000£275,000

While our forecasts look at bonus pools per business line and the historical distribution by title, we expect to see a strong trend of rewarding more junior bankers in 2015. Many teams encountered a major retention issue with young talent keen to make the switch to the buy side or private equity firms, where they can expect bonuses uncapped by regulation, and often a less intense corporate culture. This exodus away from banking have left entire teams depleted of their Associates and VPs, leading to incapacity to pitch or execute new business.

 

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