Bank by bank, here's what we've heard about bonuses for 2018
More and more banks have announced their bonuses for last year. No one but their recipients knows exactly what they were like. Banks never comment on their bonus awards and bankers generally keep their jubilation or dejection to themselves.
Below, therefore, is a list of what headhunters are saying about the current bonus round. - Many commiserate or celebrate with bonus recipients on a weekly basis and are a weather vane at least for sentiment in the market.
Bank of America Merrill Lynch's latest bonuses:
It might be supposed that Bank of America didn't pay big bonuses for 2018, particularly in M&A. The U.S. bank suffered a 26% fall in M&A revenues last year while most rival banks achieved double digit increases. In the circumstances, a big pay rise doesn't seem entirely deserved.
BAML told its people how much they were allocated last month. Despite some disgruntled outliers, headhunters say it wasn't that bad. "The pool [in M&A] seems to have been down 5% to 10%, but most people were expecting this and so were happy with it," says one headhunter, speaking off the record.
Another headhunter, speaking on a similarly anonymous basis, says BAML appeared to pay in line with JPMorgan and Goldman Sachs. "Bonuses were down 5% to 10% across various businesses, but this was in line with the market."
Barclays' latest bonuses:
Barclays' bonuses remain shrouded in mystery. The British bank hasn't announced its bonuses for 2018 yet and is due to tell employees their numbers this week (analysts and associates in the investment banking division are seemingly told on Friday).
In the meantime there are various unconfirmed reports that Barclays is squeezing under-performing directors, who might therefore be disappointed at bonus time. The UK bank continued to make multiple managing director hires last year and given weakness across the market in the fourth quarter, Barclays may need to make cost savings.
BNP Paribas's latest bonuses:
BNP Paribas's 2018 bonuses are as obscure as Barclays'. - The French bank won't announce them until early next month.
When the time comes, they are unlikely to be especially generous. After a challenging fourth quarter, BNP is in cost-cutting mode and the amount it's trying to cut is ominously similar to the size of last year's bonus pool in its corporate and investment bank. In January, Bloomberg said BNP was considering paying some of its traders nothing at all in bonuses for 2018.
Citi's latest bonuses:
Citi's most recent bonus round seems to have been a low key affair, with comparatively few people who were happy and comparatively few people who were sad. "No one was ecstatic. No one was depressed," sums up one headhunter
The firm's analysts have been moved to a summer payment cycle anyway. One headhunter says Citi's junior bankers and successful managing directors were kept happy, at the cost of its directors.
Credit Suisse's latest bonuses:
Credit Suisse announced its bonuses last Friday. One headhunter in London said the bank's analysts and associates have been paid, "slightly up on last year." This follows an earlier report that the bank had frozen its bonus pool for 2018 at the level of 2017, plus claims that bonuses might not be paid in the Zurich commodities finance team following an error that saw someone there being let go.
Deutsche Bank's latest bonuses:
Deutsche Bank also has yet to announce its bonuses, but is due to unleash its numbers in early March. The mood music is already a bit scratchy. - There were reports in January that Deutsche would be cutting its bonus pool by 10% with some areas seeing declines of between 15% and 20%. Entirely unconfirmed rumours suggest global head of equities Peter Selman has intervened in an effort to mitigate the bonus decline in his area, but equally unconfirmed rumours suggest managing directors in the equities division could see their bonuses down by a quarter or more as the bank focuses on paying juniors.
Watch this space. In the meantime, Deutsche's fourth quarter results don't bode well.
Goldman Sachs' latest bonuses:
Last year there were a few complaints about low bonuses in Goldman Sachs' fixed income trading team. This year that doesn't seem to have been repeated. One fixed income headhunter said Goldman's bonuses were "ok;" an M&A headhunter said they were "fine." Not too good, not too bad.
JPMorgan's latest bonuses:
JPMorgan's bonuses appear to have been as unstartling as Goldman's. One macro headhunter said some people's bonuses were "challenged" at JPM. Another said bonuses in the investment banking division were "ok," nothing more.
Morgan Stanley's latest bonuses:
Morgan Stanley was the place to be in the most recent bonus round. Following a report in December 2018 that the bank was hiking bonuses for its bankers and traders, the bank seems to have come through. Headhunters say Morgan Stanley's bonuses were surprisingly bountiful this year. "Morgan Stanley were top of the class," says one equities headhunter. "They were top of the street," says another recruiter focused on M&A.
UBS's latest bonuses:
Some people at UBS have already been told their bonuses. Others, it seems, have not. Analysts and associates are the bank are thought to be finding out soon. In the meantime, one recruiter who also deals with more senior investmet banking division hires says numbers seem to be on a par with last year: "There's very little disappointment there," he claims.
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