At Morgan Stanley, some operations professionals are still complaining about bonuses
As we reported last week, while bonuses may have been mixed for front office bankers and traders this year, they seem more unambiguously disappointing for the middle and back office staff whose jobs are most susceptible to being automated out of existence.
Morgan Stanley appears to be a case in point. The bank still isn't commenting, but US-based operations staff in its wealth management division remain aggrieved by a change to their compensation structure.
It's understood that the bank flagged a change to the wealth management operations compensation structure at the end of 2024, making the 2025 bonus round the guinea pig. Insiders claim they were told they would receive larger base salaries in return for a drop in their bonuses.
Instead, they claim that bonuses were cut while many of their salaries remained the same. To make matters worse, they say the new compensation structure has only been implemented at vice president level and below, with executive directors and managing directors still receiving bonuses.
"I've had to tell people in my team that they won't be getting a bonus or a salary increase because their salary is already considered at the top of the pay range," says one operations VP at the bank. "They have been baffled and stunned. We had a great year and these are top performers."
It may not only be Morgan Stanley where non-revenue generating staff are being squeezed. Insiders at Citi and Goldman Sachs have also complained about reduced bonuses in the middle and back office.
In the ideal world, banks would like people to leave voluntarily to avoid paying them severance. If so, AI may be around to take the strain. Lloyds' CEO Charlie Nunn said yesterday that the bank can now use AI to process complaints in one second instead of five minutes. And Bank of America CEO Brian Moynihan said earlier this month that the bank " has built a capability" involving a "series of prompts" enabling it to reduce headcount in the audit team.
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