Post-MBA IBD associate compensation

For fellow MBAs out there who are interviewing with IBD or taking an IBD offer, what numbers have you been hearing? Seems like most banks are offering $125K base+$50K signing bonus.

 

I take it offer two was a boutique? While offer one was a BB?

Do you know if the boutique has a bump after the stub year?

The 125K base and 50-60 range in bonus is similar to what I am reading/seeing in the recent batch of summer associates starting y2 of bschool.

 

BB NYC:

Signing Bonus: $60K ($40 signing, $10 relocation, $10 early signing) A0 Salary 125

"They are all former investment bankers that were laid off in the economic collapse that Nancy Pelosi caused. They have no marketable skills, but by God they work hard."
 

After looking through the WSO 2014 Compensation report, it seems as if even for BB in NYC doing M&A from Target Schools with good GPAs, the Median Total Comp for Associate 0s and 1s was only about $170k. If the base starts at $125k, does that mean these people are only getting a 40% bonus?

I thought the bonus % for the middle bucket for BB/NYC/M&A would be a median of about 80%? So that would mean $100k bonus + $125k base = $225k. Am I wrong?

Or is it that most of those who are reporting here are the bottom buckets and middle buckets only? I'm also assuming there is only one person in the top bucket per group at a BB? (so one for TMT group, one for Healthcare group, etc.)?

Is the distribution for middle and bottom buckets about equal? or is it something like 10%/60%/30% for top/middle/bottom buckets?

 

The people posting in this thread are posting stub year numbers. Associate 0 (stub year) numbers are going to be 125k base and about 35k bonus.

First year associates (not stubs) at BB last year for middle bucket was 120k base 110k bonus = 230k total. First year Associate top bucket was 120k base + 150k bonus = 270k total.

I could go on, but you can search for previous posts from back around bonus time at the start of 2014 to see the other associate numbers. These numbers are going to change next year with the base pay increases. Most associate levels are getting a 50kish base increase. This could be offset by lower bonuses next year, but nobody knows for sure yet. Either way it's a good thing overall for associate pay, especially since the base is all cash, whereas most banks have a stock component of the bonus.

 
Thagoodlife:

The people posting in this thread are posting stub year numbers. Associate 0 (stub year) numbers are going to be 125k base and about 35k bonus.

First year associates (not stubs) at BB last year for middle bucket was 120k base 110k bonus = 230k total. First year Associate top bucket was 120k base + 150k bonus = 270k total.

I could go on, but you can search for previous posts from back around bonus time at the start of 2014 to see the other associate numbers. These numbers are going to change next year with the base pay increases. Most associate levels are getting a 50kish base increase. This could be offset by lower bonuses next year, but nobody knows for sure yet. Either way it's a good thing overall for associate pay, especially since the base is all cash, whereas most banks have a stock component of the bonus.

Thanks thagoodlife. I couldn't find a bonus thread from early this year for Associates, I've already searched pretty heavily. I found the analyst one a while back though and I remember it had little, if any, info on Associate bonuses.

Anyway, I think the information you provided is helpful. What is the distribution between these buckets like? Is it 10% bottom bucket, 80% middle bucket, and 10% top? Or is it 40/40/20? Or just evenly split 33/33/33? I understand it will vary based on firm-type, location, year, firm itself (and even individual groups), but what i it traditionally and which ones are known to vary significantly from the others?

There's a big difference in a firm paying a top bucket of 150% of base but only one person gets (and the middle bucket is only 100%) vs a firm paying a top bucket of 125% but half the people get it (and the middle is again 100%).

I've heard there may even be firms which heavily skew towards the top to get good "headline" results to show up in the papers and forums like these so the top bucket may be 200%, but then besides that one favorite associate, everyone else gets between 25% to 75% of their base as bonus....not a great situation to be in.

 

For people who are 1st year MBAs who would get the benefit of SA + FT Associate adjusted base... what would the breakdown of SA + A0 through A# be with the numbers going fwd.

Looking only at Base...

Summer Associate: comp based on A0 125k (?) A0: 125k A1: ? A2: ? A3: ? ...

(just assuming BB comp - maybe we could run a separate breakdown for boutiques, after this is answered)

 

Thanks TechBanking, that's very helpful. I wonder how similar that setup from years ago is today and how it is today for boutiques and MM's. Maybe someone else can chime in for that?

If for Analysts back then it was a $10k bump, maybe for Associates, these days, it's a $25k difference?

In that case (and combining the assumption that the bucket split is between 10/80/10 and 20/60/20), I would assume with the WSO 2014 Comp data showing median total income of around $160-$170k for Assoc 0s & 1s in NYC would mean the middle bucket at most firms was around $50k ($125k) base and that most who are reporting here got middle bucket. That would mean top bucket of only $75k? Or maybe the difference at the Assoc 0/1 level between the bonus is $35k....$35k/$70k/$95k....with most reporting here receiving low & middle buckets?

I know this is probably getting confusing. I'm just trying to reconcile the data found in the WSO report and all the information here on the forums. I just don't see how people are talking about $300k top buckets all-in for Assoc 0/1 if the median for the WSO report is only $170k. The only way that would be true is if the difference between middle & top buckets is huge (like $25k/$50k/$175k).

 

The numbers are probably messed up for A0 and A1 on WSO comp data because firms categorize them differently, so there are stub numbers included in the A1s. Lots of my friends and I are at different bulge brackets and the A1 numbers are what I mentioned above. As far as a break down of buckets, its about 20% top, 50% middle and then the rest spread around other buckets, depending on how different banks do their buckets (some 4, some 5, etc.). The median all in comp for A1 last year was around ~$230K.

 

How significantly does this differ for MM firms in NY or even in other cities (Chicago, SF/LA, etc.)?

I'm guessing about 15% lower for MM and then another 15% lower for cities outside NY? So instead of a median for BB in NYC for A1 of $230k, we're talking about $170k all-in median for Blair, Baird, Piper, Lincoln in Chicago? Or is that too much of a drop from the median for BB in NYC?

 

Just posting this so there are more data points for folks. Not saying that any of the above is false/wrong, but based on what I was told it seems slightly off. For context: I went to a top 10 MBA and graduated in 2014. Off-cycle hire at a boutique M&A bank so I started in early July. Comp breakdown below, and includes what they communicated upon extending me my offer.

A0: - Signing bonus: $40k - Relocation: $5k - Base: $110k - Bonus: I get my stub # this week so who knows but I'm thinking somewhere around my signing bonus #. Very curious to see what my stub is given the off-cycle nature of my position... not expecting much though...

A1: - Base: $125k (hearing rumors of firmwide bump to $130k or something, but no clue) - Bonus: Guidance was that in 2013, median A1 bonuses were $150k and top bucket bonuses were $175k or higher (so median all-in comp for A1 was $275k and top A1s got $300k+).

Talking to my friends who were taking BB roles, they had the $40k sign on at end of summer plus whatever relocation and plus the early sign on kicker with a sliding scale the longer they waited to sign. Base was $105k for A0 and bumped to $125k for A1. They said their guidance on bonus was around 100% of base (but that they thought this was partly managing expectations).

Just repeating what I was told, for whatever it's worth. Personally, I'm skeptical of it all, but then again, I always am. Good luck to all associates w/ their numbers...

 
thatsnachocheese:

Just posting this so there are more data points for folks. Not saying that any of the above is false/wrong, but based on what I was told it seems slightly off. For context: I went to a top 10 MBA and graduated in 2014. Off-cycle hire at a boutique M&A bank so I started in early July. Comp breakdown below, and includes what they communicated upon extending me my offer.

A0:
- Signing bonus: $40k
- Relocation: $5k
- Base: $110k
- Bonus: I get my stub # this week so who knows but I'm thinking somewhere around my signing bonus #. Very curious to see what my stub is given the off-cycle nature of my position... not expecting much though...

A1:
- Base: $125k (hearing rumors of firmwide bump to $130k or something, but no clue)
- Bonus: Guidance was that in 2013, median A1 bonuses were $150k and top bucket bonuses were $175k or higher (so median all-in comp for A1 was $275k and top A1s got $300k+).

Talking to my friends who were taking BB roles, they had the $40k sign on at end of summer plus whatever relocation and plus the early sign on kicker with a sliding scale the longer they waited to sign. Base was $105k for A0 and bumped to $125k for A1. They said their guidance on bonus was around 100% of base (but that they thought this was partly managing expectations).

Just repeating what I was told, for whatever it's worth. Personally, I'm skeptical of it all, but then again, I always am. Good luck to all associates w/ their numbers...

This is pretty much what I have heard too. For class of 2014 Associates the stub bump from A0 to A1 are as follows; GS 150/50 bonus Citi 150/35 MS 150/30 BAML 140/40

 

Anyone have any additional insight? Also was curious, but there was a website that would release bonuses by firm and do simple analysis it had something hat in the name? Can't seem to find it as I did not book mark it.

Bonus hat? I know I sound crazy, but if anyone knows what I am talking about and can share the link that would be great!

Yes, I tried googling for it...

 
 

There has been a lot of talk lately about Analyst salary bumps. Can anyone confirm anything in regards to Associate salary bumps? I saw on one of the threads about UBS Associates getting bumped to 130/140/150. Can anyone confirm either this or other banks?

 

Thanks for the info. for those who had useful comments.

..Just wanted updated numbers. Didn't seem to find current numbers in other searches and sorry I don't have all day to make worthless comments and do comprehensive searches on this site.

 

Heard the 125k figure too. Specifically, heard it at DB. They bump you upto 125k from 100k at the end of your rotation period (DB has a 6 month group rotation period). Basically you get bumped to 125k at the same time as you get your stub of 40k-45k.

Not sure about other banks yet.

 

Associate levels at DB go from 1-4. Not sure why that's the case since most BB have a scale from 0-3. Associate 1 is the stub year (Aug - Dec) during which the salary is 100k + the bonus of $40-$45k (median). Beginning next year, you are categorized as Associate 2 and the salary is 125k. The base increases by 25k at the beginning of each of the following years until you are Associate 4. So as an A4, you make $175k base + bonus. At the end of that year, you make VP and then the payscale changes completely.

 

Heavily dependent on the fund. Are we talking megafund, top MM, mid-to-low MM, growth equity? Megafunds are probably upwards of $500-600k, top MM are probably slightly below that, mid-to-low MM is $300k or so (highly variable though) and who knows on growth equity.

 

500k for post-MBA megafund associate?

Not saying that's low... but consider this --> 2 year BB --> 2 year preMBA --> 2 year MBA --> megafund associate (500-600k)

So it takes 7 years for the megafund associate to get 500k.

On the other hand, assuming one stays in banking as a analyst promote and keeps going

3 years analyst --> 3 years associate --> VP1 (500-750k)

Doesn't the BB VP actually make more in the same amount of time?....not to mention the forgone income and tuition of the MBA

 
ibhopeful532:
500k for post-MBA megafund associate?

Not saying that's low... but consider this --> 2 year BB --> 2 year preMBA --> 2 year MBA --> megafund associate (500-600k)

So it takes 7 years for the megafund associate to get 500k.

On the other hand, assuming one stays in banking as a analyst promote and keeps going

3 years analyst --> 3 years associate --> VP1 (500-750k)

Doesn't the BB VP actually make more in the same amount of time?....not to mention the forgone income and tuition of the MBA

If you work for a shitty fund that carry might not be worth shit but if you really believe in the team you are on that 1-2% carry can end up being a few mill....which is the light at all of our tunnels.

 
HFFBALLfan123:
It all depends on so many factors. Size, your importance, fund performance, your experience... If you are a star and they know you have the option to jump ship to another fund they will make sure you are happy. Way too many PE funds out there looking for senior associate/junior VP's to come in and hit the ground running.
Huh? I'd say that senior associate / junior VP positions are one of the hardest to come by. They hire folks straight out of MBAs for these roles so there isn't much of an open market for lateral folks.
CompBanker’s Career Guidance Services: https://www.rossettiadvisors.com/
 

I'll certainly agree with that! As you move up the seniority ladder, the "key" people start to get paid based on their value-add rather than their title.

CompBanker’s Career Guidance Services: https://www.rossettiadvisors.com/
 

F that. Have you ever worked with someone fresh out of an MBA class? Especially if you're at a small shop, it would be very difficult to get a quality MBA grad who has banking experience... Nothing against MBAs, but it takes them a while to get upto speed if they are new to banking. From the analyst view, they mostly function as a lightening rod in case you fuck up something they don't catch. (says the liberal arts guy...)

 

Yep, and fwiw - I just spoke with another friend of mine who is an associate and he confirmed that in his first year all in comp was high enough that he had to be paid partially in stock. I didn't pry for exact numbers and the threshold for cash bonus max differs place to place, but you still get the idea that its more than $100k... Even if you're assuming a generous bonus at 100% base, it's safe to assume the stock comp isnt a consideration until you're north of $200k.

Now I'll fax you some docs so I can get paid on this compensation consultation

 
Best Response

The range of bonus you noted is for a top or 2nd bucket associate (depending upon the firm). You can generally expect that 20-25% of your bonus will be deferred (cash, stock, or some blend of both) vesting over 3-4 years. At any of the big banks, salary will go 125 (A0), 150, 175, 200 (A3). This year at my firm, top bucket bonuses were 130 for A1s, 175 for A2s, and 225 for A3s. Most banks will be clustered around the same ranges, with some exceptions (see below). Expect a stub of ~35k (all cash) your first year. Be realistic: top bucket rankings typically go to less than 10% of performers.

All banks do rankings differently. Wells, for instance, ranks only within groups, whereas Barclays will rank you across all of IBD. If you're looking to get zero bonus, then go to Jefferies, which has a reputation for blowing people out with goose eggs on the reg. I know they'll give you the hard sell about how they work harder, blah blah blah...there's no honor in not getting paid. PM if you have any more specific questions.

 

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