Pay in asset management is slowly catching up to investment banking globally, but in Asia portfolio managers are enjoying a more significant bump up in bonuses. While overriding conditions at investment banks have ensured a maximum of 5% uplift for Asian employees, front office buy-side employees in the region have received up to 10% more.
Asset managers in Singapore have received up to 150% of their salary as a bonus this year, says Will Tan, managing director at executive search firm Principle Partners, who bases this figure on around ten asset management firms. This is the top end of the scale and the range is 50-150%, he says. Portfolio managers in Singapore earn up to S$190-350k ($136-252k), according to figures from recruiters Robert Walters. Based on these salaries, total compensation could come in at S$850k ($595k).
This uplift compares well with asset management bonuses in other parts of the world. On Wall Street and in the City of London asset management bonuses were either flat or slightly down on 2014, according to analysis provided to eFinancialCareers by PwC.
Investment banking bonuses generally increased by up to 5% in Asia this year, according to people with knowledge of the situation, but compensation packages have been shrinking. Banking still outstrips the buy-side at a senior level in Asia, however, with investment banks' managing directors in the region receiving around in S$800k-1m bonuses this year. This is down from $1.2m-$1.3m a few years' ago.
This is not surprising considering investment banks' focus on reducing headcount in Asia. Goldman Sachs has laid off 30% of its Singaporean investment banking employees, including some senior departures. RBS is drastically scaling back its investment bank in the region - in line with a huge redundancy programme that will see 14,000 of the 18,000 investment banking staff lose their jobs in the coming years - while Standard Chartered has also cut jobs.
Asset managers in Asia have been paying their star performers at the expense of other functions. Tan says that back office employees, which typically don't receive large bonuses anyway, have paid between 25%-50% of salaries as a bonus. This is down on last year.
Asia's asset managers are paying in line with their global peers. While investment banking pay has nose-dived since the financial crisis, average pay per head at asset management firms has increase by a fifth to $263k, according to recent analysis by think-tank New Financial.