That didn't take long. As we reported yesterday, junior investment bankers have suddenly become extremely, extremely hot property. And in a market of inelastic supply but burgeoning demand, a rise in their price seems inevitable.
The first to succumb to the urge to keep juniors happy with a payoff appears to be Credit Suisse.
The Swiss bank has increased salaries for directors and below in its capital markets and advisory businesses. It's also offering a $20k 'special bonus' to vice presidents and below in its capital markets and advisory business. The bonus and pay increases are understood to apply globally.
A spokesperson for Credit Suisse said: “Credit Suisse’s Capital Markets & Advisory management recognizes and wants to reward the efforts of our people who have not only managed to support our clients through unprecedented deal volume, but also increased our share of the market.”
The bonus increases alone appear to take total first year compensation at Credit Suisse to well over £92k ($130k).
According to the most recent salary and bonus survey from London search firm Dartmouth Partners, Credit Suisse's first year analysts received salaries of £50k and stub (six month) bonuses of £22k last year. The additional $20k (£14.5k) in bonus will bring the new total £92k ($126k), even though the bonus is only for six months. This is before salaries are increased too.
Prior to today's increases, Dartmouth Partners summer 2020 pay survey said second year analysts at Credit Suisse in London were earning £94k, third years were earning £110k, associates Os were earning £128k, and that first year associates were earning £162k.
Last year's pay survey from recruitment firm Arkesden Partners said Credit Suisse was paying £180k in salaries and bonuses to second year associates, £215k to third years, and between £264k and £310k to its vice presidents (VPs).
Bloomberg reported previously that bonuses for Credit Suisse's investment bankers were comparatively generous last year compared to bonuses in the bank's markets division. Revenues from the bank's advisory business rose 67% year-on-year in the final quarter of 2020, although overall spending across the investment bank remained flat.
One Credit Suisse director who missed out on the pay rise by virtue of his seniority said he too is working hard. "I start the day at 7am and yesterday I went to bed at 4.20am," he said. "Luckily I don't have time to be jealous."
Credit Suisse's pay rises come after Swiss rival UBS ran a town hall yesterday. Senior UBS bankers offered advice to juniors on how to make the most of the two hours off the bank is giving them during the day, but there were complaints that this was patronizing and the time off insufficient.
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