2022 Compensation - What Are You Guys Expecting?

What are you guys expecting on comp this year and what would you be happy with? Imagine folks at BB are expecting less than EBs given that revenue at a lot of EBs has held up.

I'll start. I'm an ASO3 at EB and made ~$525k all-in last year as an ASO2 (ASO3 apparently was ~$600k). I'm setting expectations at ~$525k for this year, would be happy with $550k+ this year, and would be irate if all-in was a dollar under $500k. 

 

That seems very low for an ASO 1, especially for a MM which tends to pay well above BBs. $275 - 300k is more like an ASO stub year total compensation.

 

ASO stub year comp at BB is $175k base plus $35-$50k bonus, or $210-$225k all-in

ASO1 comp at BB this year likely to be $175k base plus $120-$150k bonus or $295-$325k all in. Would add another $50k or so for each level up to ASO2 to AS03.

 

I think $225k will likely be at or slightly above the upper quartile for AS3 bonuses.

 

This is extremely optimistic. We should revisit this thread once bonuses actually get paid out. 

Deal flow (i.e. completed deals) are down significantly YoY, but you guys believe bonuses will be slightly down to flat compared to last year. 

 

I think it depends on the bank, where they ranked last year on comp, and how this year performed relative to last year. At my firm, which is mostly M&A, we're down ~15% YoY, but we also weren't at the top of the tables for comp last year, so there would be a lower water mark to reduce comp from. My group is also up YoY and next year will be just as busy, so if they don't reward my group, will be incentivized to switch to a sleepy group if socialist pay policies across groups persist.

 

I think it depends on the bank, where they ranked last year on comp, and how this year performed relative to last year. At my firm, which is mostly M&A, we're down ~15% YoY, but we also weren't at the top of the tables for comp last year, so there would be a lower water mark to reduce comp from. My group is also up YoY and next year will be just as busy, so if they don't reward my group, will be incentivized to switch to a sleepy group if socialist pay policies across groups persist.

Ofc it depends on bank lol and you're fine. But overall the industry is going to get a body blow this year I think people would be wise to manage expectations 

 

I’ve noticed they don’t tend to penalize the analysts and associates as much in a down year. Certainly they will for the senior bankers, but they’re not going to cut A&A bonuses significantly (e.g., probably keep cut them 10-20% from last year vs. a 40-50% cut)

 

I've noticed they don't tend to penalize the analysts and associates as much in a down year. Certainly they will for the senior bankers, but they're not going to cut A&A bonuses significantly (e.g., probably keep cut them 10-20% from last year vs. a 40-50% cut)

Dude you've never even seen a down year like this. There hasn't been one since 08. Bonuses will be down meaningfully 

 

I think depends on how reliant your group / firm is on M&A/financing. 

If solely M&A advisory, think expect numbers will be down 20-25% YoY, off of record year least year and lot of uncertainty ahead.

If heavily weighted on markets (dead ipo market) and took on horrible losses on debt for some of the big LBOs this year (citrix, twitter, etc.), wouldn't be surprised if bonuses were down 30-50%. 

 

If I were flat to last year, meaning if I got last year's bonus despite being a year more senior, I would consider that an upside scenario.  My base case is a 20% reduction to last  year's bonus which would equate to around a 30% reduction on a like-for-like basis if you consider I'm a year more senior.  Would add that I was paid above street last year.

 

Were bonuses generally that good across the street in 2020 and 2021?

I know GS, and the typical high paying EBs paid outsized, but comes out to like 4-5 firms of which EBs have way smaller headcount’s. I’d guess 70%+ of the street got 20-25% higher, with most AN / ASO really not seeing the benefit of record years. This seems consistent to what others are saying. At my BB, top bucket was below 100% for AN, and maybe 100% for ASO.

I’m not saying that bonuses won’t be down YoY. But if we’re not participating in the upside, I wonder how much you can really lower without breaking the camels back given 2023 will likely be busier.

 

If I were flat to last year, meaning if I got last year's bonus despite being a year more senior, I would consider that an upside scenario.  My base case is a 20% reduction to last  year's bonus which would equate to around a 30% reduction on a like-for-like basis if you consider I'm a year more senior.  Would add that I was paid above street last year.

This is pretty much where I am as well, could honestly be more of a haircut realistically

 

as3 (ignore username)

just want at least 200k bonus which is sort of low now but will not make me depressed.

 

as3 (ignore username)

just want at least 200k bonus which is sort of low now but will not make me depressed.

Lol 200k is a low associate 3 bonus? That's a win in this market if you're at a BB

 

Looks like warnings across the board on compensation. The trading units are getting cuts on bonuses despite revenue increases YOY so one can imagine how investment banking is going to do. Wouldn’t be surprised at 20%+ cuts from last year

 

Agreed. That is some real BS to be a trader and make a ton of money for your bank just to have it redistributed. Will be interesting to see if EBs who paid less than Goldman last year and whose revenue is much less impacted this year, relatively speaking, return to paying a [30]% premium to BBs. If not, it begs the question of what the purpose of working for an EB is.

 
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yeet 

(Deleted because every time I make a revealing post on WSO I get a LinkedIn notification that an abnormal amount of Banking Analysts have searched for me) 

 

Yeah, it works for me. Definitely nothing more in life that I want/need in terms of material luxuries. Private Placement deals are really fun too. 

I also think I can get my salary up to $135-$150K pretty easily during my next comp meeting. We're a small group and I'm the most senior non-MD employee. Ie, I do almost all of the work, train all of the juniors, etc. You could say I took the be a Big Fish in a Small Pond approach to career progression. 

 

At an EB, major question plaguing a lot of minds is what is the purpose of being here if we don't get paid materially above BB when M&A was less impacted?

I get it if you're an analyst - more M&A resume experience, buyside opps, pay

But if you're an associate to vp trying to think about a career in banking, tougher to sell the firm (not as many products and support teams), less brand equity and future career optionality, and we got equivalent pay to GS last year... equation making less sense.

 

I'm not going anywhere probably. But my friends at BBs don't see value of lateraling at this point anymore to EB because they have a lot of firm support, culture of big group / fluffy initiatives, better pathway to MD and more products to sell, etc. Just saying it seems to contrast vs a few years ago when EBs seemed to be able to poach anyone. Maybe just my bubble of people though. 

 
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Controversial

Your bonus this year should be not getting fired. Business is down 50%+ and you guys are expecting a 20% y/y reduction from elevated numbers? 

 

Yeah buckle up kids. You’re all about to find out just how much society values our admin work.