The poor cousins in private equity

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The US private equity group unveiled its finances at the weekend, revealing that Stephen Schwarzman, its chief executive with a penchant for Rod Stewart, made US$398m last year in salary and carried interest. Senior chairman Pete Peterson made US$212.9m (according to the Financial Times) and Schwarzman's anointed successor, Tony James, earned US$97.3m.

While Schwarzman's many millions wouldn't go amiss for most people, they don't look quite so impressive relative to his peers at the top of the hedge fund ladder. April's annual Trader Monthly list of the world's best hedge fund traders revealed that the top five each took home more than $1bn last year.

Schwarzman is, however, well off alongside his counterparts at the helm of investment banks: Goldman chief executive Lloyd Blankfein took home a meagre US$53.4m last year.

But banks best bet for juniors

Investment banks are still among the best payers for junior staff, though.

"The candidate market is so tight that the big banks are really starting to flex their financial muscles," says Peter Elliott, a director at hedge fund-focused recruiter Emerson Chase. "A lot of hedge funds just can't compete with them."

Banks are due to announce analyst and associate bonuses in the next few weeks. A survey of expectations by recruiter EM Financial Services suggests second year analysts will earn salaries of 41k to 46k, plus bonuses of 60% to 100%. Some recruiters put those figures even higher.

Elliott says a junior analyst with similar years' experience working in a hedge fund can expect a similar salary of around 45k, plus a marginally lower bonus, typically in the 50% to 70% range. "Going in at that level you are not going to be getting the stellar bonuses that lead analysts in hedge funds can command," he says.

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