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. 

Comments (123)

1mo 
MBA2WS, what's your opinion? Comment below:

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.

  • 2
  • Associate 1 in IB - Cov
1mo 

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.

  • 1
  • Associate 1 in IB - Cov
1mo 

Please see above.

  • 1
  • Associate 1 in IB - Cov
1mo 

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

  • Associate 1 in PE - LBOs
1mo 

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. 

  • 4
  • 1
  • Associate 3 in IB-M&A
1mo 

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.

  • Works at Goldman Sachs
1mo 

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 

  • Associate 1 in IB - Cov
1mo 

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)

  • Works at Goldman Sachs
1mo 

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 

1mo 
Bopityboop, what's your opinion? Comment below:

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%. 

~$500 all in last year, this year expecting ~$450 all in even with the extra year of seniority.

  • 1
1mo 
Apex Kurtosis, what's your opinion? Comment below:

Ikr this guys making $525k/yr like holy fuck. Kudos to him but I could never dream of making that much money. My goal is to get a ft offer as an analyst at a boutique or mm at around $70-$100k all in

  • VP in IB - Gen
1mo 

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.

  • Associate 1 in IB - Cov
1mo 

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.

  • 2
  • VP in IB-M&A
1mo 

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

  • Associate 2 in IB - Cov
1mo 

as3 (ignore username)

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

  • Associate 3 in IB - Gen
1mo 

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

  • Associate 2 in PE - LBOs
1mo 

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

  • Associate 3 in IB-M&A
1mo 

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.

  • Associate 2 in IB-M&A
1mo 

GS was bleeding talent at the Aso/VP level having lagged behind EBs for years. Had to make a statement to keep people in their seats. Doubt they'll be able to repeat given how investors reacted. All the other BBs did not pass on the 2021 profits to Associates at least, avg Aso1 comp was still 300k vs 400-450 at EBs

Most Helpful
  • Associate 1 in IB - ECM
1mo 

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) 

  • 6
  • Associate 1 in IB - ECM
1mo 

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. 

  • 2
  • 1
1mo 
ab216, what's your opinion? Comment below:
ADTIBE

This didn't age well at all.

https://www.bloomberg.com/news/articles/2022-12-02/wall-street-slashes-bankers-bonuses-as-talent-war-comes-to-an-end?srnd=premium

If BB bonus pools are being cut by 30%, MDs will be down 40-50% (particularly cap markets), mid about 20% and juniors will be down 10%. Seniors got most of the upside in the good years and will take most of the downside as well.

  • Associate 1 in IB-M&A
1mo 

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.

  • 2
  • Associate 1 in IB-M&A
1mo 

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. 

Controversial
  • NA in IB-M&A
1mo 

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? 

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  • Analyst 3+ in IB - Cov
1mo 

This describes my bank (MM); down like 60% YoY though 2021 was insane. About same deal fees as 2018/2019. However we have almost twice the headcount of 2018/2019 with much higher base salary for this huge headcount vs 2018/2019. With that logic in mind highly doubtful that bonuses will be good still 

  • NA in IB-M&A
1mo 

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

  • Associate 1 in IB - Cov
1mo 

Believe the figure is 30% cut over last years pay. At my BB that equates to 90-120k for first year associates….putting total pay at 265-295k… ouch!

  • 1
  • Associate 1 in IB - ECM
1mo 

My Lower Mid Market, Capital Markets, Jive Turkey ass is lucky to clear $275 in a good year.

1mo 
phillyboy, what's your opinion? Comment below:

Yea that's not happening.

Expect it to be $150k+

Array
  • Associate 3 in IB-M&A
1mo 

Seriously? Looking at Moelis' revenue and MD count, MD count has been pretty stable over the last few years, but revenue is up big and this year is still going to be a blowout for Moelis compared to 2018, 2019, 2020.

All of these EBs are just looking for a reason to cut bonus pools so we shouldn't be quiet about the fact that 2022 has been a GREAT year for ALL EBs. You know Evercore is going to be cheap every chance they get and PJT hasn't exactly blown it out of the water on comp over the last few years so now all these EBs are just looking for a reason to bring comp below 2018/2019 levels (unadjusted for inflation) despite higher revenue than 2018/2019. Total nonsense.

Moelis 2018 Q3 YTD revenue: $647mm

Moelis 2019 Q3 YTD revenue: $523mm

Moelis 2020 Q3 YTD revenue: $521mm

Moelis 2021 Q3 YTD revenue: $1115mm

Moelis 2022 Q3 YTD revenue: $778mm

  • Associate 2 in IB-M&A
1mo 

Pop open their 10Qs. Accrued comp liability as of 3Q is 200mm vs 390mm in '21. 

  • 2
1mo 
justafellowmonkey, what's your opinion? Comment below:

We're going to see a lot of natural attrition this year, at all levels. People saw the writing on the wall a long time ago that bonuses were going to be significantly down. Firms were still staffing and guaranteeing bonuses up to Q3. Hell, I'm still getting hit up by recruiters weekly.

Bonuses down a lot from VP to MD, bonuses down less than that at the A&A level. I think enough people will leave on their own that layoffs won't be significant / could be non-existent at the A&A level. Hell, every firm is still hiring summer interns.

  • Associate 3 in IB-M&A
1mo 

Hoping for 75% of base TBH and id be pretty fudging happy. 50% bonus and no lay off and id be alright. Layoff and no bonus and id spiral, spiral into a deep deep deep hole...wake up 2 weeks later wasted with two hookers on the beach in ibiza with syphilis and monkey pox

  • 1
1mo 

Given headlines of 30% reduction in bonus pool, and cuts to trading bonuses despite their meaningful outperformance vs. IB, honestly I'd be ok with a 35% cut from last year's bonus (even with an extra year of seniority). Group revenues in many IB groups are significantly down (often 40%+), so it wouldn't be surprising in the least. For analysts/associates (esp. analysts) I'd probably think flat or slight increase is doable but would be surprising if bonuses actually stayed flat for senior associates and above

For background, as VP2 (now VP3) at mid BB coverage, made $640 all in last year ($370 bonus). At end of the day, it's just extra money we get in an already high paying role that makes far more than most others. If you're in the finance field for the long haul, I think being satisfied with your career progression and role ends up being a lot more important over the long term. Of course worth considering leaving if you feel you're being underappreciated (either comp or WLB), but otherwise as with most things there will be up and down years

  • 3
  • Associate 1 in IB-M&A
1mo 

Maybe hard to believe AS bonus will be flat to up if you think VP bonus down 35%, curious why you dont they wouldn't bridge the discrepancy of declines a bit. 

1mo 

Maybe hard to believe AS bonus will be flat to up if you think VP bonus down 35%, curious why you dont they wouldn't bridge the discrepancy of declines a bit. 

Yes, sorry meant to say early Associates might be flat (AS0, AS1), but later Associates (AS2, AS3) may slightly start to be down. It's really a gradient that gets worse as more senior, with MDs being a bit more variable depending on how much biz they personally won. For me as a VP3, I'm a lot closer to D level responsibilities in terms of bringing in revenue, so I expect my comp is going to be tied a lot more to group and banking revs than juniors. Early VPs might see a bit less of a drop. 

It really comes down to the fact that the more senior you are, in theory the more influential you are on banking revenues and thus you're going to be tied more to it, while more junior members are more on execution quality. That said, I'm not on any comp committees, so this is all speculation anyhow

  • 1
1mo 
TheBuellerBanker, what's your opinion? Comment below:

Junior to mid level comp has a lot of rigidity baked in given folks in those roles aren't usually subjected to the ups and downs that producers such as directors or MDs are required to hit in order to make a good year in variable. My firm is doing ~10% down likely in class level comp meaning if you were a 1sr year vp, you'd make what a 2nd yr vp did but lower by 10%.

Has to be said of course, this applies to high performers, if you are a low performer than you will most likely get an absolutely dogshit bonus and also be kindly escorted out the door. Typically low performers always got a tiny bonus but if you were an analyst getting a 115k bonus and someone one else in your class was getting 10k, then it's pretty obvious what the idea is of where that guy stands. In this environment, it's safe to assume that guy getting the 10k bonus will likely either get less or nothing and be a part of the waves of RIFs occurring throughout the banks. All comp is being allocated to the high performers for retention and meritocracy.

As someone who hasn't professionally worked through a downturn but is seeing everything from a different perspective than most folks in banking, I feel comfortable saying the above as it's what I've witnessed in the discussions involving comp for the 2023 payout.

  • 6
  • Analyst 3+ in IB - Cov
1mo 

Rigidity aside though, I have to imagine the element of just hard you worked factors in too no? For context my bank overhired based on 2021 activity levels which led to a lot of people with <40 hour workloads and low staffings. They're already touting how WLB was great this year so have a hard time believing that even if you're a "top performer", you'd be down only 10% versus 2021. There's simply no incentive to pay lights out bonuses to juniors since lateral market is dead and 2023 looks equally choppy. I do agree the low performers will get the stick but I don't think it's looking great for the mid either. 

  • Senior VP in IB - Cov
1mo 

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  • Analyst 2 in IB-M&A
1mo 

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  • Associate 3 in IB-M&A
1mo 

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  • Associate 2 in IB - DCM
16d 

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