Concern about the long term viability of some leveraged loans arranged during the past 12 months has done nothing to dampen bonus expectations in the sector. According to recruiters, practitioners are expecting to be handsomely rewarded.
"Expectations are super high," says Monique Hanson, head of capital markets recruitment at London-based search firm the Rose Partnership. "People are expecting a 20% to 30% rise."
Hanson says a junior VP working in leveraged finance in the City can expect a total package worth 227,000. Lee Thacker, a consultant at Highland Partners in London says the most senior leveraged financiers can expect 3m or more: "There will be plenty of $4-$6m pay checks for the most senior people at the top three or four banks this year."
On Wall Street, recruiters say pay could rise 15% to 25% at banks such as JP Morgan, which have increased their share of the US leveraged loans market. This year, a junior VP in a US leveraged finance team can reputedly expect to earn somewhere between $450,000 and $600,000.
Despite a flurry of hiring, pay in Continental Europe's financial centres is less generous. Andreas Weik, head of financial services recruitment at Frankfurt-based Hoffman Heads, says German-based leveraged finance staff with five to seven years' experience can expect packages worth €300,000 at the very most. Leo Lopes, a consultant at Paris-based Vendômes Associés, says their Paris-based counterparts face a similar ceiling, albeit one which is up considerably on last year.
Leveraged financiers in Milan will be least equipped to splash out this Christmas. Barbara Valaperti, a consultant at Heidrick & Struggles in Milan, says a junior VP working in an Italian leveraged finance team can expect to earn €200,000 max.