Wall Street Investment Bank Business Revives Again? Big Banks Expected to Increase Bonuses by Double Digits

According to sources familiar with the plan, top executives at several of Wall Street's largest investment banks are devising plans to award traders and matchmakers with the highest bonuses since the epidemic, with many departments seeing bonuses increase by 10% or more. Insiders revealed that this is the average raise for stock and fixed-income bankers and traders at Bank of America Corp (BAC.US). Secondly, sources said that at Morgan Stanley (MS.US) and its larger competitor JPMorgan Chase (JPM.US), bonuses for traders will increase by more than 10%. Bonuses for Morgan Stanley investment bankers will increase by about 15%. Goldman Sachs Group, Inc. (GS.US) will be offering greater incentives to certain trading departments. Previously, the entire industry has endured two years of restrictions, with investment banks struggling to sustain the trading and trading frenzy they dealt with at the height of the epidemic. A year ago, the lukewarm gains on most desks were insufficient to keep up with inflation. Now, managers are planning raises to reflect the improved business and some optimism for the year ahead. After all, the trading revenue for these four companies for the first nine months of last year grew by less than 10%. Increasing bonuses faster can help ensure that employees stay and compete for more business. But the average figures described by industry insiders do not reflect the most lucrative rewards that top executives are about to receive, nor do they reflect the circumstances facing those who have been deemed underperforming by their supervisors. As we all know, Wall Street bonuses are highly unstable as the industry cycles between boom and bust. In good economic times, windfalls for individuals could reach millions of dollarsseveral times the salary income of bankers and traders. When the epidemic spread in 2020, Wall Street firms initially hesitated to transfer what could have been temporary windfalls. But as competition for talent intensified, they raised compensation for 2021. Later, rising interest rates dampened trading, keeping bonuses in check. Bank leaders began setting the latest bonus pools at the end of last year, and in recent weeks they have been communicating these decisions to mid-level managers. Bank of America Corp will begin reporting financial performance next week. For months, compensation consulting companies have been predicting that this round of salary increases for investment bankers, traders, and asset and wealth management professionals will reach double digits, with some businesses seeing increases of over 20%. For example, a report by Johnson Associates Inc. in November predicted that compensation for equity underwriters could be up by 25% and for bond underwriters by 35%.