Junior bond market staff were among those who saw the biggest salary hikes in fixed income in 2000. Lower paid bond sales assistants and junior bond salesmen saw their remuneration rise by 17% and 24% respectively last year, according to recent data from the Monks Partnership, which surveys small and medium sized finance institutions.
At the other end of the hierarchy, people were not so lucky. Monks records that heads of bond capital markets saw a slight fall in basic salaries and a substantial fall in median bonuses from 62% in Novemeber 1999 to 45% in November 2000. Average salary for a head of capital markets was still 158,000.
Jim Madison, manager at Banking Additions, a recruiter for back office staff, says that those in support roles are becoming more valuable. Banks are looking for a higher calibre person that is able to undertake a more varied role, he says.
A shortage of high quality junior back office means that prices are being bid upwards. With salaries low to start with, big percentage increases are not difficult to achieve.
At the other extreme, those at the top are likely suffering for past excesses. According to a leading headhunter, second tier banks have been overpaying top capital market professionals. "Second tier employers are questioning the value of some of their senior people. A lot of the people that have claimed to contribute to good results over the past few years, have in fact made little impact.
"There's recognition that a lot of these people are merely average performers and that the second tier banks need to introduce greater transparency, in line with bulge bracket firms." Reductions in bonuses paid to the most senior people are interpreted as further evidence of their failure to perform.