Banking salaries converge in Eurozone

A recent salary survey by Robert Walters, the middle and back office recruitment specialist, reveals a surprising similarity between the salaries earned by bankers in different continental European cities.

Financial analysts working in asset management in Amsterdam, Paris and Luxembourg, all receive a base salary of around €50,000. IT business analysts in Paris and Amsterdam enjoy base salaries of €45,000. A head of risk in Amsterdam or Dublin can expect to receive in the region of €90,000 base.

Maurits Claassen, director of continental European operations at Robert Walters, says the congruence is partly the result of the introduction of the euro. Since all salaries have been put into euros there is far greater transparency, said Claassen.

The survey also highlighted areas where pay differences still exist. In Paris and Frankfurt, young fund managers can expect to start on salaries of some €40,000. Yet career progression appears more favourable in Paris: after two years, Parisian fund managers earn between €60,000 and €110,000; fund managers in Frankfurt only earn between €60,000 and €75,000.

Private bankers are better off in Frankfurt, however. With salaries exceeding €75,000, a private banker in Frankfurt with more than three years' experience is 50% better remunerated than counterparts in Paris or Brussels.

Claassen said that European banking salaries are usually higher the further north one goes: bankers in Amsterdam and Frankfurt are better remunerated than those in Paris and Milan. Exceptions exist where strong demand for a particular type of professional drives salaries up.

The survey suggested that credit and structured financing experts are in short supply, particularly in Frankfurt and Paris. As a result, salaries in these areas are rising. Conversely, salaries for other investment banking positions, particularly those related to equities, were found to be static or falling.

Further reductions are likely in future. The euro may have leant transparency to European salary levels, but the downturn has done little to foster labour mobility. "There are now far fewer transfers from one city to another," says Claassen. As a result, there are pockets of excess supply.

The survey also revealed that salaries in the UK remain significantly higher than in continental Europe. Fund managers in the in City of London earn up to three times more than those in Frankfurt or Paris. Similarly, credit analysts in London can earn nearly twice as much as their German colleagues. In most cases, London salaries quoted in sterling are comparable to, or more than, continental European salaries quoted in euros.

Giles Daubeney, chief operating officer at Robert Walters, says the discrepancy is unsurprising: "London is still considered one of the major financial centers of the world. Salaries here reflect this."