Salary survey: Senior fund management pay soars in US

Remuneration for senior fund management staff in the US has risen sharply, despite a 25% fall in the value of the average stock mutual fund since January, a pay survey shows.

Chief investment officers raked in a 59% pay rise - boosting their total annual remuneration to $772,000 - in the year ended March 31.

At the other end of the pay scale, average total compensation for intermediate fund managers in the US rose 10% to $234,000.

But senior portfolio managers had to put up with a pay cut of 13%, to $335,100, according to the study by Buck Consultants, an executive search firm.

The mixed picture contrasts with an August survey of UK fund managers by the Monks consultancy, which showed lower bonuses dragging remuneration down across the board in the past year.

A main reason for the differences is the sheer size of funds in the US, brought on by the US government's move away from providing pension benefits in recent decades - a shift that European governments have only recently undertaken.

The public in Europe have proved reluctant to start providing for their own retirement, which has wrong-footed fund managers who expected a large increase in demand. A number of firms which entered the fund management arena in the mid-1990 have since had reason to regret it.

Firms such as Rothschild's asset management arm, Commerzbank's Jupiter arm and Threadneedle are widely believed to be available to the right bidder.

The maturity and size of the US fund management business allows managers to earn a premium for doing the same work as their European counterparts.

But the future may be less kind to them. Investors in the US, angry about their shrinking portfolios, are beginning to turn a critical eye on executive compensation.