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Emolument's Bonus Predictions for UK Bankers in 2016

 

NOTE: if using the data below, it is essential that you refer to Emolument.com as ‘salary benchmarking site’ and use hyperlinks to www.emolument.com


7.12.15: Salary benchmarking site Emolument.com has analysed historical data to forecast upcoming bonuses at London Investment Banks. Prospects largely depend on specialisms - it's bad news if you're in M&A, but slightly better news if you're an equity trader. See the full results below:


Investment banking (M&A, Origination and Syndication)

Despite a record year for mergers and acquisitions, investment bankers are likely to see their bonuses fall due to a sharp decrease in the number of IPOs - down 36% from 2014
 
Title 2015 2016 Prediction Change(%)
Associate £33,000 £32,000 ⇩ 3.0%
VP £80,000 £76,000 ⇩ 5.0%
Director £130,000 £124,000 ⇩ 4.6%
MD £250,000 £239,000 ⇩ 4.4%


Trading - FICC

It's been a tough year for commodities, and FICC traders may not be surprised that their bonuses are likely to take a significant hit. Our predictions have them falling by almost 10%.
 
Title 2015 2016 Prediction Change(%)
Associate £30,750 £28,000 ⇩ 8.9%
VP £64,000 £58,000 ⇩ 9.4%
Director £125,000 £114,000 ⇩ 8.8%
MD £290,000 £265,000 ⇩ 8.6%


Trading - Equities

After a relatively poor year performance in 2014, equity desks have rallied in 2015, and traders specialising in this area should see their bonuses climb.
 
Title 2015 2016 Prediction Change(%)
Associate £30,000 £31,000 ⇧ 3.3%
VP £75,000 £77,000 ⇧ 2.6%
Director £147,000 £151,000 ⇧ 2.7%
MD £353,000 £361,000 ⇧ 2.3%
 

Overall trends

The above predictions show the trends for individual departments. However, bonuses will also be affected by broader macro patterns, and on balance we are seeing a number of negatives likely to impact our estimates. Some of the biggest banks are facing hefty fines, and Chief Executive of Deutsche Bank John Cryan recently made comments about bonuses that may alarm his employees, saying he doesn't empathise with those who claim they 'work harder because they can be paid a little bit more'.

Meanwhile, the FT predicts an overall downward trend, but claims banks will do whatever it takes to keep their top performers, even if it comes at the cost of bonuses in other departments.

Alice Leguay from Emolument.com said: "Previously, receiving a 'doughnut' or zero bonus was akin to being encouraged to find employment elsewhere. With ever more restricted bonus pools, it may be that doughnuts become more commonplace, as banks limit substantial bonus payments to key outperforming staff they simply cannot afford to lose."

Methodology: Emolument analysed the correlation between bankers bonuses and deal volumes for the last 3 years, and extrapolated 2016 bonuses predictions based on Coalition’s numbers for 2015 deals.
 

For more information, contact press@emolument.com or call Alice Leguay/Hugo Ostyn on +44 20 7183 1744.
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Copyright © 2015 Emolument.com, All rights reserved.


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