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INDUSTRY INSIGHT
FIFX & EQUITIES:END OF YEAR REPORT& SALARY SURVEY 2017
www.selbyjennings.com | [email protected] Industry Insight | Enabling Exceptional Careers
2016 was a particularly turbulent year for the financial markets. Beginning with a freefall in Chinese Equities which sent the investment world into panic mode, June brought the unexpected vote for Brexit and the year has ended with the election of Donald Trump as President of the United States. Accordingly, reflecting the world in which they operate, the financial markets have been decisively difficult to read, albeit immensely profitable for some.
Unsurprisingly, the financial recruitment markets have mirrored the erratic behaviour seen in the markets they service – perhaps exacerbated by the impeding regulatory change in the banking sector, which, it seems, no one is yet in a position to fully understand.
2016 saw a notable spike in candidates being hired and made redundant in the same year, as well as hiring processes dematerialising shortly before their conclusion – often many months after they had begun.
‘Restructuring’ was the phrase of the year ; with many banks in a constant state of change, many employees growing frustrated at the uncertainty they face and their continued inability to perform their functions as they would like.
What can we expect in 2017?
As we enter the New Year, there is a notable sense of optimism from people across the sell-side; exemplified by the change seen in Broking firms across the city and the proactivity of Heads in Investment Banks.
Many Broking Firms were hiring consistently over the course of 2016, employing an increasing number of the extremely talented people who have been made redundant from Investment Banks.
Broking hires tend to be opportunistic, however; rarely will a Broker launch a search for candidates with a specific skill set. There was a deviation from this trend this December – particularly in Credit and Equities – whereby a large number of Broking Firms have been reaching out and providing detailed mandates in accordance with their respective strategies for the New Year. Similarly, with Investment Banks, a large number of Team Heads have called and asked for us to launch searches in anticipation of the headcount they seem sure will arrive in early January. After years of detraction and prolonged uncertainty, it seems the sentiment across the markets is changing and the Financial Institutions are growing increasingly more certain and/or positive in their approach.
INTRODUCTION
Industry Insight | Enabling Exceptional Careers
Capital Optimisation
In view of the strict regulatory changes pertaining to how banks hold and apply capital, there has been an increasingly pressing need from banks to ensure that capital is used optimally. In accordance with this need, a greater emphasis has been placed on attracting candidates with regulatory expertise, especially in areas which are deemed to be suffering the most from these changes.
Diversity
“20-30% of the candidates introduced in a process are female”
It has long been a priority in London to improve upon the relative lack of diversity seen in the banking sector.
The way in which Investment Banks are approaching this drive appears to be changing, however, with the process becoming increasingly more formalised. It is now not uncommon for Investment Banks to require Recruitment Consultancies to ensure that a minimum of 20-30% of the candidates introduced in a process are female.
As a firm that attaches a great deal of importance to diversity – in both the campaigns we support and the consultation we provide – we feel proud to have been one of the catalysts for this change.
Juniorification
Traditionally, Selby Jennings has specialised in Vice President – Director Level recruitment, with the large majority of the placements we make falling into this category. Although VP – Director Level hires still make up the majority of the roles we have placed over the course of the year, the ratio has changed quite dramatically, with many Investment Banks looking to add more Analysts and Associates. The two most common reasons cited for this preference are to improve upon the balance of a team and to reduce operating costs.
Specialisation
With exception of the Tier 1 American banks, many banks are narrowing their focus to target a specific subset of the market, often cutting whole teams in the process. A common trend is for banks to become more specialised in covering Corporate and/or Institutional clients derived from the same geography as the bank itself, tailoring its strategy and product range to match their needs.
THE TRENDS OF 2016
The below provides an overview of the current salaries paid in London (including ‘top-ups’), the bonuses people received last year and the bonuses people expect to receive this year.
Each of the numbers below is approximate, they are all in GBP and the bonus information disregards candidates who did not receive a bonus and those from Investment Banks which are able to pay employees bonuses in excess of the 100-200% cap employed elsewhere.
FIXED INCOME
FOREIGN EXCHANGE
EQUITIES
REMUNERATION SURVEY
It has been a profitable year for many in Fixed Income, especially for those in Rates. Although there have been challenges regarding the scarcity of bonds – largely due to the strategy of mass-buying employed by the European Central Bank – the unusually high level of volatility in the markets has enabled many to make reasonable-to-strong returns.
In 2017 we expect to see an increasing number of hires made in Government and Corporate Bond Trading, as well as the continued hiring of senior client-facing Structurers. Experience Salespeople covering German Institutional clients are also in high demand
FIXED INCOME
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£0
£20,000
£40,000
£60,000
£80,000
£100,000
£120,000
£140,000
£160,000
£180,000
£200,000
Analyst Associate VP Director
Mean Salary
Mean Bonus (Last Year)
Mean Bonus (This Year)
FIXED INCOME:SALES
Title Salary Range(£)
MeanSalary (£)
Bonus Range Paid Last Year (£)
Mean Bonus Paid Last Year (£)
Bonus RangeExpected This Year (£)
Mean BonusExpected This Year (£)
Analyst £38,000 - £65,000 £52, 000 £1,000 - £18,000 £9,000 £5,000 - £30,000 £15,000Associate £55,000 - £95,000 £71,000 £8,000 - £65,000 £42,000 £15,000 - £85,000 £60,000VP £80,000 - £175,000 £118,000 £15,000 - £170,000 £96,000 £40,000 - £180,000 £134,000Director £125,000 - £220,000 £177,000 £35,000 - £400,000 £139,000 £80,000 - £400,000 £180,000
www.selbyjennings.com | [email protected] Industry Insight | Enabling Exceptional Careers
£0
£50,000
£100,000
£150,000
£200,000
£250,000
Analyst Associate VP Director
Mean Salary
Mean Bonus (Last Year)
Mean Bonus (This Year)
FIXED INCOME:TRADING
Title Salary Range(£)
MeanSalary (£)
Bonus Range Paid Last Year (£)
Mean Bonus Paid Last Year (£)
Bonus RangeExpected This Year (£)
Mean BonusExpected This Year (£)
Analyst £40,000 - £65,000 £58,000 £5,000 - £14,000 £7,000 £5,000 - £40,000 £15,000Associate £60,000 - £90,000 £78,000 £10,000 - £68,000 £50,000 £30,000 - £80,000 £70,000VP £90,000 - £160,000 £122,000 £22,000 - £210,000 £112,000 £80,000 - £200,000 £145,000Director £115,000 - £330,000 £168,000 £80,000 - £660,000 £142,000 £100,000 - £660,000 £208,000
www.selbyjennings.com | [email protected] Industry Insight | Enabling Exceptional Careers
£0
£50,000
£100,000
£150,000
£200,000
£250,000
Analyst Associate VP Director
Mean Salary
Mean Bonus (Last Year)
Mean Bonus (This Year)
Title Salary Range(£)
MeanSalary (£)
Bonus Range Paid Last Year (£)
Mean Bonus Paid Last Year (£)
Bonus RangeExpected This Year (£)
Mean BonusExpected This Year (£)
Analyst £36,000 - £60,000 £48,000 £5,000 - £15,000 £10,000 £10,000 - £25,000 £13,000Associate £62,000 - £90,000 £73,000 £5,000 - £45,000 £52,000 £20,000 - £60,000 £45,000VP £90,000 - £200,000 £120,000 £32,000 - £200,000 £128,000 £70,000 - £250,000 £160,000Director £135,000 - £260,000 £189,000 £70,000 - £410,000 £160,000 £120,000 - £500,000 £201,000
FIXED INCOME:STRUCTURING
With the unpredictability seen in 2016, the need for FX hedging has become increasingly more obvious.
It is perhaps for this reason that some Investment Banks have enjoyed a remarkable year, with teams specialising in Corporate Solutions (IRFX) appearing to be the most fruitful. FX Trading teams have also enjoyed 2016, in many cases; the volatility of the markets has provided them the opportunity to generate large returns over short periods of time.
One trend we have seen across FX is the reduction of headcount in Spot FX Trading teams as the sector becomes more technologically focused. FX Trading, in particular, has also been significantly impacted by ‘juniorisation’, with many senior traders choosing to pursue new opportunities within similar sectors, such as Proprietary Trading, Consultancy, etc.
FOREIGN EXHANGE
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Title Salary Range(£)
MeanSalary (£)
Bonus Range Paid Last Year (£)
Mean Bonus Paid Last Year (£)
Bonus RangeExpected This Year (£)
Mean BonusExpected This Year (£)
Analyst £38,000 - £60,000 £48,000 £3,000 - £15,000 £9,000 £5,000 £12,000Associate £50,000 - £80,000 £70,000 £15,000 - £60,000 £29,000 £20,000 - £80,000 £47,000VP £78,000 - £220,000 £115,000 £15,000 - £170,000 £110,000 £40,000 - £220,000 £130,000Director £140,000 - £300,000 £182,000 £35,000 - £400,000 £145,000 £100,000 - £600,000 £212,000
FOREIGN EXCHANGE:SALES
£0
£50,000
£100,000
£150,000
£200,000
£250,000
Analyst Associate VP Director
Mean Salary
Mean Bonus Paid Last Year (£)
Mean Bonus Expected This Year (£)
www.selbyjennings.com | [email protected] Industry Insight | Enabling Exceptional Careers
£0
£50,000
£100,000
£150,000
£200,000
£250,000
Analyst Associate VP Director
Mean Salary
Mean Bonus Paid Last Year (£)
Mean Bonus Expected This Year (£)
Title Salary Range(£)
MeanSalary (£)
Bonus Range Paid Last Year (£)
Mean Bonus Paid Last Year (£)
Bonus RangeExpected This Year (£)
Mean BonusExpected This Year (£)
Analyst £35,000 - £62,000 £45,000 £5,000 - £20,000 £8,000 £5,000 - £30,000 £12,000Associate £50,000 - £90,000 £68,000 £10,000 - £90,000 £40,000 £25,000 - £120,000 £65,000VP £75,000 - £200,000 £110,000 £10,000 - £172,000 £96,000 £50,000 - £150,000 £120,000Director £110,000 - £330,000 £187,000 £35,000 - £460,000 £121,000 £80,000 - £460,000 £198,000
FOREIGN EXCHANGE:TRADING
www.selbyjennings.com | [email protected] Industry Insight | Enabling Exceptional Careers
Title Salary Range(£)
MeanSalary (£)
Bonus Range Paid Last Year (£)
Mean Bonus Paid Last Year (£)
Bonus RangeExpected This Year (£)
Mean BonusExpected This Year (£)
Analyst £35,000 - £55,000 £42,000 £5,000 - £15,000 £7,000 £5,000 - £55,000 £17,000Associate £45,000 - £75,000 £65,000 £10,000 - £62,000 £32,000 £20,000 - £115,000 £58,000VP £80,000 - £130,000 £94,000 £22,000 - £110,000 £69,000 £50,000 - £110,000 £76,000Director £125,000 - £310,000 £174,000 £35,000 - £240,000 £112,000 £75,000 - £400,000 £150,000
FOREIGN EXCHANGE:STRUCTURING
£0
£20,000
£40,000
£60,000
£80,000
£100,000
£120,000
£140,000
£160,000
£180,000
£200,000
Analyst Associate VP Director
Mean Salary
Mean Bonus Paid Last Year (£)
Mean Bonus Expected This Year (£)
For many banks it has been a difficult year across Equities, with some cutting ties with these markets quite aggressively. As a result, Broking Firms look set to capitalise, taking a greater portion of market share from the traditional big names.
One of the most notable trends in Equities has been the demand for talented Delta One Index Salespeople and MSCI Specialists at Broking Firms – at Selby Jennings we have seen almost every firm active in these spaces looking to add. Into 2017 many Investment Banks seem eager to build upon their Equity Derivative Sales teams by attracting candidates with Strategic/Event Driven Equity Derivatives Sales experience.
Another key trend relates to MiFID II. Although it is not yet clear exactly how much these regulations will affect the world of banking, they will change the way in which people are able to choose who they work with – expanding upon the current criteria requiring them to seek best execution – as well as the way in which execution and research costs are calculated and presented to clients. As a result, there has been a notable increase in the demand of talented Sales-Traders over the year and a spike in Broking Firms securing some of the more reputable Researchers in
EQUITIES
www.selbyjennings.com | [email protected] Industry Insight | Enabling Exceptional Careers
£0
£20,000
£40,000
£60,000
£80,000
£100,000
£120,000
£140,000
£160,000
£180,000
£200,000
Analyst Associate VP Director
Mean Salary
Mean Bonus Paid Last Year (£)
Mean Bonus Expected This Year (£)
Title Salary Range(£)
MeanSalary (£)
Bonus Range Paid Last Year (£)
Mean Bonus Paid Last Year (£)
Bonus RangeExpected This Year (£)
Mean BonusExpected This Year (£)
Analyst £38,000 - £68,000 £45,000 £1,000 - £25,000 £12,000 £5,000 - £30,000 £15,000Associate £58,000 - £90,000 £68,000 £10,000 - £80,000 £32,000 £10,000 - £100,000 £35,000VP £75,000 - £178,000 £115,000 £30,000 - £210,000 £82,000 £10,000 - £180,000 £58,000Director £135,000 - £300,000 £182,000 £65,000 - £420,000 £110,000 £50,000 - £300,000 £100,000
EQUITIES:SALES
www.selbyjennings.com | [email protected] Industry Insight | Enabling Exceptional Careers
£0
£20,000
£40,000
£60,000
£80,000
£100,000
£120,000
£140,000
£160,000
£180,000
£200,000
Analyst Associate VP Director
Mean Salary
Mean Bonus Expected This Year (£)
Mean Bonus Paid Last Year (£)
Title Salary Range(£)
MeanSalary (£)
Bonus Range Paid Last Year (£)
Mean Bonus Paid Last Year (£)
Bonus RangeExpected This Year (£)
Mean BonusExpected This Year (£)
Analyst £40,000 - £70,000 £46,000 £5,000 - £25,000 £9,000 £5,000 - £30,000 £17,000Associate £60,000 - £90,000 £67,000 £8,000 - £90,000 £36,000 £10,000 - £60,000 £32,000
VP £80,000 - £175,000 £120,000 £25,000 - £240,000 £78,000 £30,000 - £200,000 £61,000Director £115,000 - £310,000 £172,000 £60,000 - £350,000 £104,000 £50,000 - £200,000 £95,000
EQUITIES:TRADING
www.selbyjennings.com | [email protected] Industry Insight | Enabling Exceptional Careers
£0
£20,000
£40,000
£60,000
£80,000
£100,000
£120,000
£140,000
£160,000
£180,000
£200,000
Analyst Associate VP Director
Mean Salary
Mean Bonus Paid Last Year (£)
Mean Bonus Expected This Year (£)
Title Salary Range(£)
MeanSalary (£)
Bonus Range Paid Last Year (£)
Mean Bonus Paid Last Year (£)
Bonus RangeExpected This Year (£)
Mean BonusExpected This Year (£)
Analyst £38,000 - £58,000 £43,000 £3,000 - £23,000 £8,000 £5,000 - £40,000 £20,000Associate £50,000 - £72,000 £29,000 £5,000 - £78,000 £40,000 £15,000 - £75,000 £43,000
VP £75,000 - £135,000 £105,000 £30,000 - £180,000 £84,000 £40,000 - £200,000 £70,000Director £130,000 - £280,000 £174,000 £45,000 - 375,000 £112,000 £100,000 - £350,000 £102,000
EQUITIES:STRUCTURING
www.selbyjennings.com | [email protected] Industry Insight | Enabling Exceptional Careers
As we come to the end of 2016 the Financial Institutions which shape the Financial Markets appear more positive and more certain than when we started the year. 2017 is likely to bring some big changes of its own, however, which will likely cause a ripple effect across the sector in London.
Firstly, it appears that the two leading German banks will make a number of changes in accordance with the strategies they are in the process of implementing. As such, many Salespeople, Traders and Structurers look set to leave the banks. Where they land will determine how the lost market share will be divided – this looks especially true in Equities and with regards to certain Derivatives.
A similar shift of market share could take place following the changes expected from some of the Italian banks, with Non-Performing Loan portfolios looking to dictate strategies therein. The Illiquid Credit market could become considerably more profitable for some – especially for those on the buy-side – depending on how and when these changes take place.
Similarly, it remains to be seen how the changes in the United States will affect the profits of those operating in the Emerging Markets, with some banks already discussing the reduction of headcount. It seems likely, therefore, that there will be a number of changes in this space, also.
Although the feeling at most Investment Banks is that a sense of certainty is returning, following a number of years without it, it is still likely that there will be a high volume of movement this year. Redundancies look probable and some of the higher performers are currently looking to move due to a number of different reasons – e.g. they expect to be underpaid, underappreciated, unable to perform their job due to internal restrictions, are growing unhappy with the negative or political atmosphere around them, etc. As always, movement creates opportunities for others – with those willing to take a calculated risk the most likely to reap the rewards.
Please note that the above salary surveys cover a significant proportion of the market, within vastly different Investment Banks taking into account different levels of seniority. If you would like to learn more about what you should be earning or paying, specific to your individual circumstances, please do get in touch. Our Consultants in the FIFX & Equities Team will be happy to help: [email protected].
SELBY JENNINGS
This guide has been brought to you by Selby Jennings, part of the Phaidon International.
Selby Jennings is a specialist provider of Financial Services recruitment solutions across Europe, the US, Asia and the Middle East.
We believe every professional should benefit from the advice of a trusted partner throughout their career.
Contact Selby Jennings for more information about career opportunities in this sector, or if you are looking to expand your team.
Contact us today:[email protected]
Enabling Exceptional CareersSelby Jennings exists to enable exceptional career around the world; we connect exceptional talent with exceptional opportunities.
INDUSTRY INSIGHT
