eFinancialCareers

UBS has taken a firsts step to doing away with the concept of annual bonuses. The Swiss bank today unveiled details of a new bonus scheme, under which ‘top executives’ will receive (at the very, very most) a third of each year’s bonus at the end of the year in question. The rest will be put aside and only awarded if the bank/employee performs well and behaves nicely in subsequent... Read more

As ever, it looks like banks have waited until Q4 before slashing headcount in a manner that in any way approximates to the fall in their revenues. So, if you’re one of the people let go in the months to come, will you have any right to a portion of this year’s bonus? Sadly, the answer is probably no. Despite a promising article in this week’s Financial News, which seems... Read more

Not entirely surprisingly, bankers in London and New York are expected to suffer more than those elsewhere come bonus time. International financial services headhunter Options Group is predicting a 45-50% reduction in payouts in the two cities, while Dubai bankers will apparently see their pay chopped by only 10-15%. Asia Pac staff are expected to fall in the middle of the two, with 35-40% reductions in bonuses predicted. Eric... Read more

The rumour doing the rounds in risk circles is apparently that risk bonuses are going to be spared the ravages of the market. “Risk has been ring fenced,” says David Butter, of risk recruitment firm GRS Consulting. “Most people expect bonuses to be slightly down, but not nearly to the extent of other areas. Some operational risk teams have had the best years of their careers.” Needless to say, such... Read more

A salary survey from US private equity headhunter Glocap Search LLC sounds a favourable note for anyone working in private equity or contemplating leaving investment banking for a new life on the buyside. While investment banking bonuses are unquestionably falling, Glocap’s ‘indepth analysis of 2008/09 compensation at US-based private equity funds,’ suggests PE pay is actually increasing. Bonuses at the largest venture funds (those with $2bn or more under management) are... Read more

Amidst the gloom surrounding bonuses, one positive point has so far been overlooked: most US banks pay in dollars and year-to-date the dollar has appreciated more than 20% against the pound. There are mitigating factors: dollar payouts are typically restricted to staff at VP level and above, and with US interest rates falling the dollar’s recent gains may yet be at least partially reversed. But for the moment, at least, the... Read more

The very best placed people in this market have guaranteed bonuses. And the very worst placed people in this market are working with the people who have the guaranteed bonuses. Individuals already appear to be coming to this conclusion at Nomura and they may yet reach a similar conclusion at Russian bank VTB. According to The Independent last weekend, Nomura bankers are feeling peeved that their ex-Lehman colleagues are getting guaranteed payouts in line with last year. Headhunters say... Read more

Technologists working in investment banking who are able to demonstrate business nous have seen a 5% uplift in their salaries in the last three months, while pay elsewhere in IT has remained static, according to a new salary survey. The average IT worker in an investment bank saw their pay slip by 2.4% in the second quarter of this year, according to a survey by financial IT recruiters JM Group,... Read more

For anyone still living under the delusion that bonuses paid in 2006 and 2007 were even vaguely normal, the Office of National Statistics (ONS) has produced some figures showing that they were, in fact, hideous mutants. The ONS has only been assimilating figures for total UK financial services bonuses since 2001. Even so, the fluctuations are huge: 2001: £6.5bn 2002: £6bn 2003: £5.5bn 2004: £7.5bn 2005: £9bn 2006: £11bn 2007: £16bn 2008: £16bn With... Read more

Jamie Dimon seems to be having second thoughts about trying to stave off staff depression by paying reasonable bonuses. According to CNBC, MDs at JPMorgan have been told they’re in line for a 30-50% cut in bonus. It could be that Dimon is planning to direct bonuses at top performers and lucky people further down the hierarchy. Average compensation per head at the investment bank fell ‘only’ 18% in the first nine... Read more

Until it stumbled into the arms of Ken Lewis and his campaign to curb the excesses of Wall Street, it would appear that Merrill was actually planning to reward its people quite well this year. According to one of our ever popular estimations of average compensation, mean pay at Merrill was due to be marginally higher in 2008. The bank’s Q3 results indicate that average comp per head was coming... Read more

Last year, the average Goldmanite earned $662k. In 2006, he/she earned $623k. And in 2005, the average was $498k. Now that the firm has been recapitalised by the US government, such jaw-dropping bonuses could be a thing of the past. According to Bloomberg, Goldman is one of nine banks which will receive $125bn from the US Treasury. Participating banks will be obliged to accept restrictions on executive pay. Lloyd Blankfein,... Read more

With the financial system in crisis and politicians of all hues calling for compensation to be capped, it’s easy to miss a more prosaic reason why bonuses are unlikely to reach stratospheric levels in future: broker dealers no longer exist. Ken Lewis underscored the point in a recent interview with Fortune magazine. “Merrill was paying typical Wall Street pay,” he said. “Their staff people were making a lot more... Read more

If you still have a job at the end of the year, bonuses are clearly going to be abysmal, but amidst the chaos it’s easy to forget that some people will be fine. Some people have guarantees. And they are not all working at Nomura. Cast your mind back to this time last year. In October 2007, Royal Bank of Scotland hadn’t seen its share price plummet more than 30% in... Read more

Rumour has it that Nomura's suddenly having second thoughts about paying enormous two-year bonuses to the people it's poached from Lehman. According to one totally anonymous headhunter, the Japanese bank has reached a realisation that this isn't 2006 and has cut its two-year guaranteed packages to one year. "A few people are still getting two-year deals, but most of them have now been rescinded and taken down to one year,"... Read more

More colour is emerging on the nature of the package being offered by Nomura to Lehman staff in London – and it looks very generous indeed. According to a totally anonymous (and possibly spurious) commentator on an earlier article, senior Lehman staff moving across to the Japanese bank are being offered two-year guaranteed bonuses based on the packages they received in 2007. Headhunters give credence to the rumours. Bonuses for 2008... Read more

The latest quarterly missive from Wall Street’s omniscient compensation paylord-bonus guru, Alan Johnson, doesn’t make for very cheering reading. According to Johnson and his analysts, any more unforeseen writedowns could lead to a ‘compensation meltdown’. Given most writedowns have been unforeseen so far, the prognosis isn’t particularly great. Other cheering trends identified by Johnson are as follows: • A crescendo of layoffs is coming as banks realise that... Read more