Investment Banker Bonuses Cut in Asia
In this article (4)
Investment bankers at global banks in Asia will see lower bonuses this year due to a slump in dealmaking in the region.
The bonus pool at UBS’ investment banking unit is 14 percent lower than 2019 for Asia ex-Japan, and 9 percent lower at Morgan Stanley.
At Citi the decline was lower, at 6 percent, while Goldman Sachs kept overall bonuses flat, the report, which cited unnamed sources, said.-
According to the publication, slowing economic growth in China, which reached a 30-year low in 2019, was partly behind the slump in dealmaking, with the value of mergers falling 9 percent. Fee compression was also cited as a factor behind the lower bonuses.
UBS, which is undergoing a global revamp of its business, took a hit as it was suspended from sponsoring IPOs in Hong Kong. The ban was lifted two months early in January.
Following a record year in 2018, Morgan Stanley’s overall investment banking revenue declined about 12 percent, and its Asia bonus pool was cut after lower merger and acquisition fees, a source said.
Questions & Answers
Q.Which banks saw their bonus pools cut in Asia, and by how much?
Which banks saw their bonus pools cut in Asia, and by how much?
UBS's investment banking unit in Asia ex-Japan saw a 14 percent bonus cut, while Morgan Stanley's was down 9 percent. Citi experienced a smaller decline of 6 percent.
Q.What factors contributed to the slump in dealmaking and lower bonuses in Asia?
What factors contributed to the slump in dealmaking and lower bonuses in Asia?
Slowing economic growth in China, which hit a 30-year low in 2019, reduced the value of mergers by 9 percent. Fee compression and a ban on UBS sponsoring Hong Kong IPOs also played a part.
Q.Did all major investment banks in the region cut their bonuses?
Did all major investment banks in the region cut their bonuses?
No, not all. While UBS, Morgan Stanley, and Citi cut their bonus pools, Goldman Sachs kept overall bonuses flat, according to the report's unnamed sources.
Reader pulse
What does declining investment banker bonuses in Asia signal for retail?
22,358 votes so far