Bonus day at Goldman & JPMorgan: "General disappointment"
Today's the day at Goldman Sachs and JPMorgan. JPMorgan announced US bonuses yesterday and is announcing EMEA and APAC bonuses today. Goldman Sachs is announcing bonuses globally around now.
At JPMorgan, US sources say bonuses in sales and trading were generally disappointing, but that people were well-prepared for this: "Management's rhetoric was almost like we took a loss," says one insider. The more punitive JPM cuts were in the investment banking division, where underperformers were allegedly "crushed."
At Goldman Sachs, people we spoke to were awaiting their bonuses today. The bank revealed yesterday that compensation spending fell 15% last year. However, one Goldman insider observed that the firm seemed to have made a last minute intervention to top-up bonuses: compensation spending unexpectedly rose 16% year-on-year in the fourth quarter. "Bonuses may have been brought back from the brink," he says.
Goldman and JPMorgan's announcements come after Citi and Morgan Stanley announced their bonuses last week. One senior London headhunter said they were worse than expected for people in dealmaking roles. "The Citi investment banking bonus pool was down around 20% in EMEA but a lot of people were down 25%-40% and there were a lot of zeroes," he says. "At Morgan Stanley it was worse than anticipated - good MDs were down 30% and a lot of people were down 40%."
Another headhunter said there's a trend across the industry for managing directors (MDs) in investment banking to be paid down to protect juniors. He added that some MDs are sanguine about this state of affairs: "People are resigned to the fact that bonuses will be down 20-30% on last year, and mindful of the fact that last year was in any case an outlier and a crazy year. Bonuses were up 20% last year, so this year is just a return to the norm."
This sentiment doesn't appear to be shared by everyone, though. "Show me the banker happy to be paid less than last year, and I’ll show you a banker that doesn’t exist," another headhunter says.
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