Morning Coffee: Inside the bonus cuts at JPMorgan, Goldman & Morgan Stanley. Lessons from a demanding job and a family
How bad was it really? Now that the biggest US banks have informed staff of bonuses for 2022, the dust is starting to settle, the numbers are starting to percolate, and a new pay hierarchy is emerging.
Reporting on bonuses is always a slippery affair - banks don't comment and individuals who discuss their numbers provide an only partial perspective. However, FT Alphaville has got hold of an apparently comprehensive guide to bonuses earned by bankers at Citi, Goldman Sachs, JPMorgan and Morgan Stanley in Asia which it says applies equally elsewhere. Produced by search firm Executive Access and viewable in full here, it suggests significant discrepancies between banks.
When recent bonuses and base salaries are taken into consideration, Executive Access's figures suggest Citi spread the love most widely this year. Citi's bankers were some of the top performers in Asia in 2022 and the compensation variations between its high and low performers were some of the lowest. On the other hand, Citi paid by far the least to its managing directors. Executive Access says Citi MDs' bonuses were down 25%-50% this year; directors were down 30-40%.
Bonuses at Goldman Sachs look more differentiated. If you're a top performing MD, Goldman pays more than other banks. If you're a poor performer, it often pays less. Goldman's pay for associates and VPs looks lower than rivals at the bottom end. Executive Access claims many Goldman MDs had their bonuses cut 50%; it says associates were let off with a 20%-30% cut.
At JPMorgan, MD bonuses were reportedly cut 60%, but the bank still seems to have paid more than the rest at the top end. Executive Access suggests JPM's Asian team is replete with frustrated VPs all hoping to get promoted.
And lastly, at Morgan Stanley, the poorest performing MDs seem to have been paid particularly poorly, although top performing MDs were paid on a par with most rivals. Executive Access claims that 80% of Morgan Stanley's bonus pool went to keeping its more junior staff happy, and that mid-ranking Morgan Stanley MDs were paid 50% down.
All of this 'colour', none of it is gospel. If you have a different perspective on the recent bonus season, email us at the address below.
Separately, managing a financial services job and a family is never easy, but if you're travelling a lot it's even worse. Financial News spoke to Cuan Coulter, the head of State Street's UK business. Coulter's description of his family issues when he spent 18 months alternating between London and Boston, with two weeks in each, is opaque ("my personal relationships suffered throughout") and he says he learned "too late in life" how important it is to have boundaries. These days, Coulter has a young family and he's clear on what he won't sacrifice: "I have a young family and I no longer spend weekends away, miss birthdays or important family events."
Meanwhile...
Eisler Capital wants to become a multi-strategy hedge fund and has recruited Alain Marcus, a former Goldman Sachs partner to help it recruit portfolio managers. (Bloomberg)
State filings show that Goldman Sachs cut 600 bankers at its New York office. (Financial News)
Lazard wants Saudi Arabia as its hub in the Middle East and has recruited Wassim Al-Khatib from Citi to run its business. (Bloomberg)
The Qatar Investment Authority has doubled its stake in Credit Suisse and now owns around 7% of the bank. (Financial Times)
Julian Salisbury, chief investment officer at Goldman's asset managment business, said it will significantly cut the $59 billion of alternative investments that weighed on 2022 earnings. (Reuters)
Deutsche Bank traders James Vorley and Cedric Chanu were convicted last year for manipulating gold and silver prices with “spoof” trade orders. Yesterday, they tried and failed to get their convictions overturned. They'll now be imprisoned for a year and a day. (Bloomberg)
20% of UK workers are going back to the office because they don't want to put the heating on. (Bloomberg)
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