Here’s some good news for bankers looking to switch jobs without taking a hit to the wallet. Only a year or so after the global financial crisis had bankers in Japan waving sayonara to them, guaranteed bonuses appear to be making something of a comeback.
“It seems that guaranteed bonuses are now back, at some of our US bank clients, for senior-level and some very high performing VP-level hires,” says Tom Bowden, client partner at CDS Consulting.
With markets picking up, he adds, it looks like a race will develop for clients to rehire key front-office staff, which in turn will lead to guarantees becoming par for the course again when hiring top talent.
But just how widespread is the guarantee comeback so far? The bonuses – which are used to compensate new hires for bonuses they were expecting from their former employers – appear for the moment only to be for the most senior (or most talented) of bankers.
“For very senior front office guys I do see the possibility for them down the road, but from analyst up to VP it’s very rare you’ll see guaranteed bonuses unless firms really want the person,” says Razin Ashraf, a manager at Hays Banking.
Instead, Ashraf says through to VP level he is seeing some firms trying to attract talent by offering higher base salaries, albeit with the understanding that bonuses may be lower than in previous years.