Salary survey: Fixed income salaries fall - survey

Weak activity in the debt capital markets has led to falls in average salaries for many positions, a survey by the remuneration consultancy Monks Partnership shows.

Bonuses for several positions rose, however. Headhunters said the two trends together could reflect an increasing emphasis on rewarding staff by their performance.

Salesman mostly fared better than their trading colleagues in the February survey of small and medium-sized institutions in London, which compared debt capital markets pay with figures the year before.

Salaries fell for nearly all positions, with heads of eurobond trading recording the steepest drops in overall remuneration. Their average salaries fell to 111,000 compared to 120,000 last year.

Their bonuses took a similar hit, falling to 48% of base pay after reaching 66% last year.

Headhunters said the falls seemed to reflect personnel changes and did not imply that individuals were taking salary cuts.

Senior eurobond traders' salaries fell from 79,000 to 75,000, but this was more than offset by an increase in bonuses, which rose to 56% of base pay from 34%.

Eurobond traders followed a similar pattern, with salaries dipping to 48,000 from 56,000 but bonuses rising from 27% to 38%.

Headhunters pointed out that bonuses at many institutions were much larger than those covered by the survey.Some headhunters were also puzzled by the dip in base pay. Ann Semple, managing partner at Eban London, said: 'I am surprised to see a reduction in base salaries, as the fixed income side has held up relatively well during the past year."

Heads of bond sales' average salaries fell by 5,000 to 120,000, though this was offset by an increase in bonus to 67% from 58%.

Institutional salesmen suffered a 3,000 dip in base pay to 72,000, but gained overall through a jump in bonus from 39% of salary to 56%.

Junior bond salesmen bucked the trend with a 3,000 salary rise to 48,000, along with a bonus increase.

Sandrine Rossi Fornelli, a consultant with recruiters the Cresta Group, said the contraction in the market had forced salesmen to handle a wider range of products. Customers had become more sophisticated, with a growing appetite for hedging instruments and structured products.

Semple said: 'The fixed income markets are more healthy in recruitment terms than equities, with hiring demand in fixed income research and structured products being particularly buoyant.'