I ask because my MD in ER casually mentioned in a convo that he makes way more than his banking counter part at a MM. Dunno if that’s true. His salary is pretty public looking at $4 mil a year.
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Could be anything from just the base salary no deals and get sacked a couple years later and several $m. Don't think there's one answer to this as it depends on specific MD and we're talking about a fee based business
I've been told for an average MD around $1.5-2.5m in BB/MM. EBs around $3-4m if "average" but upwards of $5m or so if you can bring in a ton of business. Again, this all depends on how much business is brought in. If a MD brings in little business then maybe just $1m before getting kicked out.
You guys are massively understating how much BB MDs make. I know because my dad is one lol. You think guys making like $20M-$100M per deal are pulling in $1M a year? That's what like 30 year old MDs who kind of suck and only do ultra small deals get paid at random MM places. Tenured and good BB / EB Managing Directors make tens of millions all-in if they're good, year in year out. As do MDs at places like Harris Williams. $500K-$1M is like the lowest possible all-in comp one would get as an MD at a reputable firm. If you close anything worthwhile you'll fly past that.
Why do you think there are so many old-school bankers living in $10M+ houses in the Hamptons and Connecticut? Those dudes used to bank several tens of millions a year in the golden days. Look up where any Principal / Partner of a good bank from the 90s and early 2000s is now. We're talking hundreds of Ms in net worth. Now granted a lot of those guys cashed in when their boutique banks got gobbled up by bigger banks, but the point still stands. Good bankers clear well in excess of $1-2M a year.
Isn't it more realistic to think about the average or even slightly below average MD instead of a good or one of the best MDs?
My guy in ER is one of the best. Definitely an outlier, but don’t see how the bank can afford his salary when he says his banking counterpart makes less.
Maybe he generates a lot of fees for his research.
Not when you're built different, your dad spent 20+ years as head of the EMEA Capital Markets division of a global BB and the MDs at that bank are more nervous to meet you (their bosses son) than you are to meet them (your dad's employees)
Lol okay sport.
This is unbelievably in accurate saying a good MD makes “tens of millions”
This is actually pretty true, at least prior to 08. Still happens, just not as common. I know several people who have made tens of millions, but I also know far more that make 1-2 per year, maybe 3 in a fantastic year.
Even if you wrote this in 2007 it is wildly inaccurate.
Another dad data point - my dad is a MD at a big MM bank (been banking since the 90’s) and has told me he pulls an average of $2.5M/year. He told me he peaked ~$6.5M in 2021 FWIW.
Another thing to consider is the specific firm's structure. Partnership-style firms (Blair basically) pay fat bonuses in up years because they have discretion over excess earnings and how it is distributed. Public banks won't have this level of control since they have shareholders to answer to
Same with Baird, Harris Williams, etc. MDs there make a lot more than $1-$2M in years like 2021.
What would you guess average was?
What % of fees do MDs get at places like Baird/HW vs average BB
PCA MD at notable firms make around 6-7m total
How do you know the PCA MDs comp?
Looking in Salesforce for fees and who is staffed on the deals. Then it's just math.
is this a co-head or just MD?
Just an MD, co-heads likely make much more. And the heads of all of the heads - God King Dawn and Coller - make much much more
$1-$2M a year isn’t even that much. They definitely make more than that.
None of these numbers surprise me - variability is huge.
I averaged 2mm a year for the four years when I was a run of the mill MD, starting at 1.1mm and going up to 3mm
Average 5mm a year for the five years I’ve run my group, starting 4mm and going up to 6+mm.
The revenue producing tenured MDs in my group average 2-3mm but could do a lot more in a good year. Junior MDs who are still figuring it out are on 900-1.1mm.
Id consider myself 75th percentile in my overall banking group peer group of similar seniority. There are definitely people making a lot more but they tend to be tech / healthcare or restructuring or market leading product group heads vs my more boring sector, but these things are always cyclical (FIG bankers were on top in the mid noughties and post GFC).
Would you say the grind to MD was worth it? Any advice on how to stay focused and avoid burnout along the way?
Good afternoon, verified BSD. Well met.
For boutiques this seems little low for Jr MDs
Feel like VP Comp is now $500-800k and director $800-$1mm so hopefully by Jr MD its like $1-1.5mm
$2-5mm feels right for more senior MDs with real moneymakers having a shot at an occasional ~$10mm year if they crush it
There are junior lMDs who are very clearly performing like MDs and I would happily pay them 1.5mm or more.
In the cases I referenced, those are MDs who got the title but still haven’t differentiated themselves from a good Director. I don’t see why I should pay them much of a premium to Directors / VPs.
And I agree with you on the 2-5mm and the 10mm (my next personal comp goal to be there consistently)
Which type of bank were you at, if you don't mind me asking, BB?
All this is pre-tax correct? So a good 40%+ haircut give or take?
Yeah and especially at BBs a very good chunk is in restricted stock
Makes sense - thanks
damn
How much do directors and MDs in ECM/DCM get paid on average?
I feel like 95% of BBs are between 1-2M and we mostly hear/talk about the outliers. Everyone knows it's come down a lot. It's also literally all shitty deferred stock so feels like more than it actually is. You can't get a mortgage on deferred stock and if you work at a place like CS/DB/UBS, you could have gotten "paid" $2M but once you sell your stock you only got like $900K. This is how many of these dudes go broke and nobody wants to work there lol
EBs are a different story - top producers are getting paid hence why the best senior talent flocks to these banks
MM is effectively commission based.
at MM & EB you could get zero bonus if you bring in no deals easily
Also if there's one thing I learned about comp is that everyone lies about compensation. Don't buy anyone's BS
What you feel is kind of irrelevant when there's a literal senior MD 5 posts above who's spitting facts. BB / near-BB's have 2-3mm for their median 'performing' MD (not all of that is cash agreed, at my bank 50% of bonus above $1mm is deferred). Canadian MDs make $1-2mm on average and the US pays like a good 30% more at MD level.
Hi! I know this is an old thread, but in case anyone sees this, could I ask how the "Group Head" designation affects MD comp at a Baird/Harris Williams/PJT? Would that put you in the $5M-$10M or is it only a modest increase over the $2M-$5M average MD?
Group head title isn't some magical ticket to more comp, you get group head because you're already bringing in a lot of flow. They pay a chunk more for 'group management' but really, you're still responsible for your PnL so group head comp can still have a lot of variability.
Group head at a product group at my Canadian B5 supposedly pulled in $7 mm two years in a row.
Coverage group head at a leading Canadian group pulled in ~$5 mm. Then again, he said the other coverage MD only pulled in $2 mm - find it hard to believe $3 mm gap between MDs in a group and product brings in more when coverage is what brings in the deals…
Still, just gives you guys some sense of scale.
Yeah people are severely underestimating
Bump
USD or CAD?It's about $2 million difference
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