Salary survey: Credit derivatives bankers earn millions in bonuses

Senior credit derivatives staff earned bonuses of 700% or more in 2002, giving total packages of more than 1 million (€1.46m), a survey shows.

Managing directors in synthetic structuring were the top performers. They pulled in an average salary of 125,000 and bonus of 1.13m in bulge bracket firms in London, said the report by search firm Napier Scott.

'The credit derivatives bandwagon gathered pace during 2002, with second and third tier banks struggling to fill a growing number of vacancies as the market continued to expand,' the firm said.

Packages in East Asia were 10% higher than in London, reflecting a scarcity of talent there. Pay was lowest in the US. Credit derivatives developed there first and firms can hire from a bigger pool of staff.

In London, vice presidents in credit default swaps trading earned an average of 90,000 in salary and 410,000 in bonus in bulge bracket firms. In third tier firms they were on a salary of 80,000 and a bonus of 170,000.

These figures were slightly lower than in 2001 on average, but the falls were much more severe in other sectors, Napier Scott said. Credit derivatives were now attracting the most ambitious and best qualified staff in banking.

'2003 will be a year of consolidation and upgrade in credit derivatives, with the banks becoming increasingly selective about who they recruit. But the most talented candidates will continue to attract seven-figure packages,' the firm said.

It said it spoke to senior managers in dozens of banks for its survey, including Goldman Sachs, Deutsche Bank, Merrill Lynch and CSFB.