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Will you really get a bonus this year?

It doesn’t take a genius to see that bonuses will be down for 2008. Most of you still expect to get something, however. Whether this is totally realistic is open to question.

Our survey of 691 site visitors between 23rd September and 12th October 2008 (ie, coincidental with Lehman and the birth of TARP, pre-the EU bailout) showed that 68% of people still expect to receive some kind of bonus this year. Of that 68%, 32% expected their bonus to rise or remain the same.

The most bullish bonus expectations were in evidence in private banking and wealth management, where a respective 48% and 43% of respondents expected bonuses to be static or rise.

The most bearish were in credit, capital markets and hedge funds, where 50%, 45% and 42% of respondents respectively expected to receive nothing.

The prevalence of zero bonuses will depend upon whether banks decide to keep everyone happy by spreading bonus cash as widely as possible, or whether they decide to focus payments on top performers to the misfortune of everyone else.

It seems likely that they’ll go for the first option. “Overall, banks are expecting bonuses to be down around 50%,” says John Axworthy at Odgers Ray & Berndtson. “Top-ranked people will stay relatively stable, but there will be a lot more people on zero or minimal bonuses.”

If this is the case, 30% on zero bonuses could be optimistic. Some put the figure closer to 50%.

Comments (12)

  1. a bonus for what? those who are responsible for the losses and mess on the markets wont get a penny!

  2. no bonus is very un-american

  3. Sarah… a lot of people reading this will get more than they did last year. As the transition from 1st yr analyst to 2nd yr analyst, 2nd yr analyst to 1st yr associate, 1st yr associate to 2nd yr associate etc will counterbalance the lower bonus pool so overall we’ll get more than last year in many cases. Its only directors and MD who may see half of what they got last year, the youngsters will be looked after.

  4. Bank’s survival is under question mark? where to look for Bonus.

  5. Those people with a high Income including Managers and Directors, they should receive the very minimum, even nil bonus, like everyone else. Plus cutting their annual salaries. I
    nstead the little man will pay for the loss that all the “executives” have caused and still do. There is no experties put into praxis.. just speculations. What a life hey….????

  6. I work for a UK Bank – the discussion of no dividend payments to shareholders to boost capital means that decent bonuses are looking very unlikely. People can walk, but where to go at the moment is the question.

  7. Hi Grim
    never say never, your bank still needs you and you still need your bank. Would you not forego your bonus for your bank?
    Do you know that bonuses do not exist in most other jobs/parts of the world?

  8. I had my bonus discussion last week. They said I’ll most likely be getting slightly more than last year, whereas in the last few years I’d have got easily 100k more this year given the increase in my seniority. Still, important to know that what matters is your RELATIVE wealth. I’m much happier getting similar to last year whilst many peers are getting zero, than getting more when everyone around me’s also getting more. I had a long talk with a senior MD tonight who said the same thing – what’s happened couldn’t possibly be better because our RELATIVE wealth vs City peers has never been higher.

  9. “Would you not forego your bonus for your bank?”


    You got me laughing before bedtime, now I’ll never get to sleep! It’s a big faceless bank that would cut you + ruin your livelihood the moment they don’t need you, not a small boutique where you coming to work every day actually makes a difference in the grand scheme of things.

    Last year my bonus was decent, but not what I was expecting given my performance and revenues. Of course like any good young greedy banker I kicked up a stink, and “my” bank mumbled something about getting back to me at a later date, then something else about dollar depreciation. Time to flip that on its head : I expect to be up at least 20% this yr on cable alone, and have another opp (different, but good) lined up if they try to bugger me with their management rhetoric.

    Lahde’s Secret Stash Reply
  10. To Justin, i don’t agree. Junior people are the least necessary in this business and the most easily replaceable. A 2nd yr anayst or a 1st yr associate? Who cares? There are literally thousands of people begging for a job out there, you just need to say that ML, or MS or GS are looking for 10 investment bankers, or traders or whatever and there will be a line outside their doors 10 blocks long. I’m not very senior myself, but that’s the truth… anyway, in few months we’ll see, i hope for the best and wish you all luck

    Wall Street Trader Reply
  11. “the youngsters will be looked after” ??? last time I heard that (2002) approximately 50% of my analyst class was fired (75-80% in certain teams) and bonus were miserable. To be honest, juniors are never looked after, compensation only increased when competition for juniors is high (e.g. peak times). Today you will have probably hundred to thousands of analysts on the street plus the annual intake of graduates. Not my experience.

  12. juniors are there to be fired – often it’s headcount that matters more than salary numbers. if an experienced person earns x a year then it’s much better to cut 3 juniors on x/3 a piece in many ways. The City is awash at the moment with guys who were unfortunate to be from the ML, Lehamsn, BS grad programs – grads are in just the same situation as the rest of us

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