Ranking the banks where analysts are seriously underpaid versus managing directors
So you're a junior in an investment bank? Congratulations! So you earn £55k a year? Good for you. But how much are the people at the top of your pyramidical hierarchy pulling in? At the risk of sowing dissension in the ranks, are you working 100-hour weeks for £55k a year simply so that someone far more senior than you can make £1m+? Maybe.
Emolument, the peer-to-peer pay benchmarking website, has provided us with some figures on total compensation for analysts and managing directors working in front-office jobs (sales, trading, IBD) across several major banks. We've compared the two to create a 'share the wealth' indicator (below) suggesting which banks slosh pay generously down to their most junior staff members, and which banks like to keep compensation concentrated on their biggest hitters.
As ever, Emolument's figures haven't been verified by the banks concerned, which don't discuss pay. As a health warning, Emolument also declined to give us the size of its samples, but says it has 12,000 data points in its system and that the figures below have been checked for statistical anomalies.
If true, the results to our analysis aren't entirely surprising. They suggest that if you want to work for a sharing bank, you should either try somewhere French (but not BNP Paribas), or try HSBC, or (surprisingly) try Goldman Sachs. If you want to work for a bank which skews pay towards its most senior high performers, go for Morgan Stanley or RBS. If you want to start your career at a bank that pays its analysts well and to end your career at a bank that pays its MDs well, try starting out at JPM and reaping the benefits of your experience at Morgan Stanley...
A sign that Europe's investment bankers are horribly impoverished compared to the rest
Investment banking has become an industry for middle class mediocrities
Sorrow as fixed income salespeople and traders are deprived of last chance at big bonuses)
The 'share the wealth' bank ranking (most sharing first)
1. Credit Agricole: managing directors earn 7.3 times more than analysts
Want to work for a bank which keeps a lid on pay and makes sure its managing directors aren't too heavily rewarded compared to its juniors? Try Credit Agricole. Analysts at the French bank are paid an average of £42k according to Emolument. Managing directors are paid an average of £312k. That's seven times more, making CA the most sharing bank of the lot.
2. HSBC: managing directors earn 10.5 times more than analysts
HSBC isn't French, but it has a French ethos to pay. Managing directors at the London-based bank are self-reportedly paid an average of £523k. Analysts are paid an average of £50k.
=3. SocGen: managing directors earn 12 times more than analysts
Managing directors at SocGen earn an average of £384k according to Emolument. Analysts earn an average of £31.5k. SocGen seems to pay poorly compared to the industry, but at least it applies the low-pay ethos across the board.
=3. Goldman Sachs: managing directors earn 12 times more than analysts
Goldman Sachs is comparatively generous to its analysts, paying them an average of £55k, according to Emolument. MDs at Goldman allegedly earn an average of £682k. That's a lot, but not as much as MDs earn elsewhere.
=4. JPMorgan: managing directors earn 14 times more than analysts
Managing directors at JPM allegedly earn an average of £827k. Analysts allegedly earn an average of £58k. That makes JPM generous to everyone, but especially generous to its most senior staff.
=4. Barclays: managing directors earn 16 times more than analysts
Managing directors at Barclays earn an average of £808k according to Emolument's figures. Analysts allegedly earn an average of £51k.
=4. UBS: managing directors earn 16 times more than analysts
Managing directors at UBS earn an average of £761k, according to Emolument. Analysts at the Swiss bank allegedly earn an average of £47k. UBS seems to pay worse than Barclays, but distributes the spoils similarly.
=4. BNP Paribas: managing directors earn 16 times more than analysts
BNP Paribas seems to pay worse than Barclays and worse than UBS, but it distributes its pay similarly by seniority. Analysts at the French bank earn an average of £33k according to Emolument. Managing directors earn an average of £548k, allegedly.
5. RBS: managing directors earn 21 times more than analysts
RBS has a policy of paying everyone quite badly, but it doesn't pay its managing directors nearly as badly as it might. Figures from Emolument suggest the average MD at RBS earns a huge £986k. By comparison, the average analyst allegedly earns £45k.
6. Morgan Stanley: managing directors earn 23 times more than analysts
Morgan Stanley pays its managing directors inordinately well - an average of £1.16m, according to Emolument. It pays its analysts ok, but isn't the most generous to its juniors - an average of £50k, according to Emolument. All banks skew pay towards their high earners, but Morgan Stanley appears to do so more than most.