Bloomberg reported that the top bankers in Asia (excluding Japan) are having a sad year with bonuses.
On average, executives at top banks such as Goldman Sachs, Morgan Stanley and Bank of America have their pay cut by 40% to 50%, according to Bloomberg. According to calculations, the pay for senior positions drops from $800,000 to $1.50.
With good banks, the cut is softer, regarding 20% or less following a bumper 2021 with bonuses up to regarding 2 million USD.
For the more difficult banks, the cut can be in the range of 60% to 70%. There are even many people excluded from the reward list.
According to Bloomberg, the above figures reflect the general trend of major Wall Street companies in Asia. Investment banks are scrambling to keep costs under control following ramping up hiring over the past few years, amid an increasingly fierce war for talent and soaring inflation.
Morgan Stanley also decided to lay off a large number of employees in China
Asia has been the biggest growth market for many Wall Street banks for many years. However, in the context of the global economy facing many risks, banks are forced to face the difficult decision of cutting jobs and reducing salaries and bonuses.
Goldman plans to cut 3,200 jobs globally and has made two cuts in Asia since September. The bank has laid off a large number of staff in China. Morgan Stanley also made a similar move.
Some banks have chosen to narrow the salary gap between employees instead of cutting jobs, as transactions are expected to recover in the second half of this year. If the situation is not very favorable, many experts predict, there will be more cuts in staff in 2023.
Many senior positions at top banks have their salaries and bonuses cut
Among those affected by compensation, senior positions are hardest hit. Some sources say that the prize money for the first place has decreased by regarding 30%, to regarding $ 400,000 to $ 600,000. Vice positions are “vulnerable” less than a 10% to 15% drop from last year.
However, there are also some bright spots. Bloomberg said that a number of banks in South Korea and Australia have performed quite well. These companies want to retain new, high-performing employees to get ahead of the wave of recovery forecast to take place this year. Citigroup, for example, is increasing its investment bankers’ compensation by up to 15%.
