How much should you expect to earn as an analyst in IBD for a 'top tier investment bank'? In trading, the average London-based analyst earns £74k ($112k) according to figures published earlier this month. Can IBD really compete? Yes, according to a recent salary and bonus survey from financial services recruitment firm Dartmouth Partners.
Dartmouth looked at this year's analyst compensation in IBD and found it to be up, significantly. "Total compensation is up across the board on last year – an inflation-busting 7% on average," says CEO Logan Naidu.
This is partly down to strong demand for and tight supply of juniors. "Offers, counter-offers and buybacks have increased," says Naidu. It also reflects a reduction in the range of bonuses and their normalization at a higher level. "The difference between top and bottom performers has narrowed. Either all analysts have upped their game, or more likely banks are frightened of losing analysts and have decided that it’s better to keep even average performers happy," Naidu adds.
Dartmouth's figures suggest happiness is mean total compensation of £77k for first year analysts, £93k for second year analysts, and £103k for third year analysts. The breakdown between salaries and bonuses is shown in the chart below. Compare your own pay and weep - or not.
Source: Dartmouth Partners