How much am I worth? Structured finance associate, international investment bank

A panel of specialist headhunters give their assessment of typical London pay packages:

Structured finance associate, international investment bank - salary 45,000 in first year, up to 70,000 later. Bonus - 35%-100%, though lower end is more usual.

The recovery in stock markets this year, with the FTSE 100 up 33% since March, has given a lift to many sectors - not least structured finance, where the prospect of more deals is leading to growing optimism.

The last two years have been pretty lean, reflecting a general lack of interest in deal-making, with most institutions recruiting sparingly. Those with less than sterling academic backgrounds or with imperfect quantitative abilities have stood little chance, with many losing their jobs as institutions cut costs.

Ted Tracey of Mantaray Partners said: 'Structured, leverage and project finance hiring has been selective this year as the number of high-margin transactions has been down...groups focusing on infrastructure deals and large corporate transactions have been the most profitable.' .

However headhunters believe the bad times may be over. Richard Fraser of RJF Global Search argues that particularly for those with good academics and a wide understanding of products, the outlook is far from bad, with many institutions gearing up to prepare for the expected upturn in business.

'Several European & US banks have been actively recruiting due to greater activity in the asset backed securities (ABS) market, such as residential mortgage-backed securitisation and whole business securitisation,' he said, noting that European banks with a strong structured credit specialisation have been most active.

He said that due to real estate securitisation, the German structured finance market has been one of the more buoyant.

Recent hiring includes an expansion of HBOS' German acquisition finance team in September. In the same month Barclays Capital hired Henry Cooke, a veteran of the European structured finance market, as a director in its corporate securitisation team in London.

Kathryn Ward, a principal consultant at Alexander Mann, says there is some growth in restructuring and debt advisory groups, with some recycling of skills and personnel from the leveraged side and areas such as TMT.

She adds however that all banks - and particularly the European wholesale sector - have concerns over how they structure lending divisions and how integrated they should be with the other bank functions.

'Valuable skills going forward are high-yield experience fuelled by the ever-increasing number of collateralised debt obligation funds; as well as real estate and securitisation skills, especially mortgage backed,' she says.

So what has all this meant for pay? A well-established associate in structured finance should have no trouble securing between 55,000-70,000 basic, with those more closely involved in origination or sales probably earning towards the top end of that.

Bonuses are harder to predict. Ward notes that although sentiment is improving, deal flows are still light, suggesting that some staff could receive almost nothing. For most however a bonus in the region of 35%-70% is likely.

Bonuses will of course rise as structured finance activity starts to recover.

'Almost every institution is trying to gear up capabilities in structured finance, therefore opportunities do exist...(and this) bodes well for the future, ' said Fraser.

Figures and commentary supplied by Alexander Mann Global Markets, RJF Global Search and Mantaray Partners.