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Morning Coffee: Citi seals its reputation as one of best payers in the City. How much should a banker spend on a suit?

What to wear when you work  in the City

What to wear when you work in the City

Citigroup seems to pay well. As we reported a few weeks ago, Citi’s London office paid salaries averaging £603k to (non-executive) code staff in its global markets division in 2012. That suggests senior traders and salespeople at Citi were on salaries around twice as high as their counterparts at rival banks.

This generosity is being perpetuated. The Financial Times has seen an internal Citi memo stating that the US bank will paying a high proportion of its 2013 bonuses in cash. Up to $100k, Citi bonuses will be paid entirely in liquid form. 75% of Citi’s bonuses will be paid in cash up to $499k,  60% will be cash up to $3.99m. 40% will be cash beyond $5m.

It’s not clear whether this pay structure is global. Nor is it clear whether Citi’s overall bonus pool will be smaller than before. The US bank is seeking to cut costs in its securities unit and the generous cash payments could be a method of making smaller overall bonuses more palatable to recipients. However, with cash typically valued more highly than restricted stock, Citi’s bonuses are likely to be a source of envy to staff at other firms. Managing directors at Deutsche Bank, for example, have got used to having the entirety of their bonuses deferred for five years, for example.

Separately, if you’re wondering how much you need to spend on a suit to secure your career in banking, James Sleater, a former banker who set up a chain of tailors called Cad and Dandy, has the answer. Sleater told the Times that the average City man spends £1k-£1.2k per suit, but buys fewer of them. Once, bankers bought three suits a year, claims Sleater. Now they buy one, or maybe two.

Meanwhile:

Citigroup’s directors and managing directors will be receiving 20% of their 2013 pay in the form of ‘wipeout bonds’ which will fall in value if the firm’s common equity ratio falls below 7%. (Bloomberg)

Bankers in London won’t be receiving their EU-bonus-cap-related fixed pay top-ups until the summer, when they will be backdated. (Financial News) 

Mark Carney had a private meeting with the CEOs of UBS, HSBC, Deutsche and Standard Chartered at Davos. He urged them to moderate their compensation. (Bloomberg)

Jamie’s Dimon’s pay rose 74% to $20m for 2013. (Financial Times) 

Top MBA graduates have seen salaries double in the past five years. Although they graduate with $100k of debt, almost all are satisfied with their pay. (Financial Times) 

“If you precluded yourself from hiring any kid that was affiliated with somebody or whose parent was an important official or important industrialist or executive, you wouldn’t have very many people left,” Lloyd Blankfein said. “Who do you think the kids are that are multicultural and filling Harvard Business School?” (Bloomberg) 

Banks are back to hiring junior accountants to work in M&A teams. (Financial News) 

Labour party wants to reinstate the 50% tax band for people earning more than £150k. (Telegraph) 

“It is surprising but many of the best asset managers I know really hate themselves. It’s an occupational hazard – and indeed may be a pre-requisite to being really good at this game.” (Bronte Capital) 

Bank of America swaps traders are under investigation for front running clients. (Charlotte Observer) 

Five traits of high earners that will make you not want to be one. (Penelope Trunk)

 

 

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