Tax free investment banking salaries on the up in Dubai

If you’re a senior investment banker looking for a new position, the United Arab Emirates is not necessarily the best place to apply – jobs have been cut, few new opportunities are presenting themselves and the anaemic fee pool has only been edging up for the past few years.

There is one advantage to making the switch to Dubai, however, and that’s the promise of tax free earnings, which, according to the new salary survey by recruiters Morgan McKinley, are still increasing. Managing directors in investment banking now earn AED150,000 a month – 6% higher than last year and the equivalent to $489.6k annually, it says. And this is before bonuses.

More surprising, however, are the salary figures for those working in asset management in the UAE. A portfolio manager with more than 10 years experience can earn also earn nearly $500k a year before bonus, suggests the survey. The average fixed income portfolio manager in the U.S earns $530k in total compensation, according to recently released figures from Greenwich Associates, and the highest average compensation per head costs within asset management firms was $370k, our own research suggests.

Don’t board a plane to Dubai just yet, though. Nigel Sillitoe, chief executive of Dubai-based asset management research firm Insight Discovery and long-time Middle East-based portfolio manager, believes the figures to be above the average offered to senior asset management professionals.

“There was the argument that fund managers should be given a hardship allowance for moving to the Middle East, but this no longer holds water,” he said. “Most firms are still being generous with housing and schooling allowance, but salaries are certainly not above those in large asset management hubs in the Western world.”

Investment banking salaries may be on a par with London and New York, but there it’s not a good time to work as a senior investment banker in Dubai. UBS is relocating bankers from Dubai to London, RBS has lost its chief executive in the region, Simon Penney and Morgan Stanley has been trimming headcount in the region.

“Most recent recruitment has been at the analyst or associate level, who have been taken on to carry out the more administrative work that the senior investment bankers would have done themselves a few years ago,” said Barbara van Meir, managing director of Dubai-based headhunters Vogel & Noor.

Here are some key figures from Morgan Mckinley’s latest salary survey: