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Morning Coffee: How to earn $225k after three years, your job is killing you

investment bank bonuses

Proof, as if it were needed, that it’s a good time to be a junior investment banker. Buoyed by 20% pay increases and paranoia of a buy-side exodus, investment banks are now paying their analysts more than they did at the height of the pre-crisis boom.

Yes, analyst bonuses have just been paid and, according to figures acquired by Mergers & Inquisitions, banks have been unusually generous. It might be an ominous sign of another looming crisis to some, or simply the result of a competitive job market, but banks are now paying their analysts more than they did in 2007.

First year analysts received bonuses of $65-80k, which rose to $85-100k for second years and $90-120k for third-year analysts. The sweet spot for first year analysts was $75-85k – this was what most banks paid – but if you were closer to the bottom of the pile you received $60-65k. One ‘elite boutique’ supposedly paid $100k to a first year.

Factoring in average salaries of $85k, $95k and $105k for the three analyst levels then total comp comes in at $150-165k (analyst 1), $180-195k (analyst 2), $195-225k (analyst 3). This is, according to M&I analysis, the best year since 2007.

But wait; investment banking pays well but it also requires long hours – despite recent concessions to allow analysts a bit of time off – and this is bad news. If you work more than 40 hours a week on a consistent basis – and let’s face it you’re not even in the investment banking game unless your clocking 70 hours plus – you will have “increased mortality by 20%”, suggests new study by Stanford and Harvard researchers. If your working patterns increase stresses in your homelife you have increased odds of self-reported ill-health of 90%.

Meanwhile:

Small lenders in places like Ohio and Rhode Island are attracting more senior Wall Street professionals who have conceded they’re never going to make it to the upper ranks (Bloomberg)

A compliance professional at Barclays who blew the whistle was allegedly demoted and offered money to stay quiet (Dealbook)

The average bonus in the UK financial sector was £13.1k ($20.2k), which was the only sector to register a decrease (ONS)

Millennials are the ‘freelance generation’, native freelancers and this makes them better prepared for the future of work than anyone else (Fast Company)

More trouble brewing for Deutsche Bank over Libor? The Serious Fraud Office is interviewing more traders (Bloomberg)

Blackrock has just bought a ‘robo-adviser’ which automatically constructs portfolios for clients based on their investment needs (Financial Times)

Every large investment bank has shrunk the amount of investment banking it does and some are more wealth managers than anything else (Financial Times)

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