A new salary survey highlights the meteoric increase in pay for people working on new derivative products.
According to the survey of more than 2,500 people by recruitment firm Napier Scott, pay for derivatives structurers has risen 200% in the past five years, an increase that exceeds that for employees in all other market-related positions.
The survey found that an executive director working on credit structuring in a top-tier bank in the UK can now expect an average base salary of 110,000, plus a bonus of 745,000. At a similar level, his or her counterpart can command an average salary of 110,000 and bonus of 620,000 for structuring equity derivative products.
"Rising pay for structurers reflects the enormously increased need for more complex products," says Shaun Springer, chief executive officer of Napier Scott. He says the big focus this year will be on equity derivative structurers and hybrid structurers as well as people to sell structured products of all kinds to hedge funds.
The survey also highlighted discrepancies in pay for credit structurers located in the US, the UK and Asia, with most Asian and UK structurers receiving substantially higher bonuses than their US counterparts. At director level, Asian credit stucturers in tier-one banks received average bonuses that were more than twice as high as those paid to US credit structurers, for example.
Springer says banks in Asia are actively hiring derivatives staff at the moment, but that recruitment remains focused in Europe: "Asia's catching up, but Europe is still the centre for derivatives recruitment. Banks in London are looking for staff across the board."
Exotic credit structuring: UK-based, tier-one bank
Managing director: Average salary: 120,000; <Average bonus:1.1m
Executive director Average salary: 110,000; Average bonus: 745,000
Director Average salary: 90,000; Average bonus: 450,000
Associate director Average salary: 80,000; Average bonus 225,000
Associate Average salary: 70,000; Average bonus: 90,000
Exotic credit structuring: US-based, tier-one bank
Managing director: Average salary: 110,000; Average bonus:1.18m
Executive director Average salary: 90,000; Average bonus: 590,000
Director Average salary: 80,000; Average bonus: 240,000
Associate director Average salary: 60,000; Average bonus 155,000
Associate Average salary: 50,000; Average bonus: 80,000
Exotic credit structuring: Asia-based, tier-one bank
Managing director Average salary: 110,000; Average bonus: 1.12m
Executive director Average salary: 100,000; Average bonus: 880,000
Director Average salary: 80,000; Average bonus: 540,000
Associate director Average salary: 70,000; Average bonus: 280,000
Associate Average salary: 60,000; Average bonus: 85,000