New York bankers are expected to pocket bonuses as high as 35% as Wall Street deal-making roared back to life after the economic malaise after the COVID pandemic.
Johnson Associates, a firm that specializes in banking compensation issues, said chunkier profits, a surging stock market and low interest rates will lead to the first bump in bonuses across all sectors since 2021.
“This year has been surprisingly good, and the industry is quite optimistic about 2025, especially with the potential of announcing more M&A deals,” said Alan Johnson, the consultancy’s chairman.
Johnson added that while the size of bonuses remain below the record levels from 2021, revenue and compensation have been “abnormally good.”
His firm said that investment bankers working on debt deals could look forward to an eye-popping 35% bump in bonus pay this year, while those working on mergers could expect an increase between 15% and 25%.
Bond traders can see a bump between 5% and 10%, while hedge funders could get up to a 15% spike in their pay packets, according to Johnson Associates.
Only real estate and retail financiers are set to miss out on the bumper payouts, the report said.
The report comes after a study by New York bean counters last month forecast bonuses that will rise by 7% this year.
Figures released by State Comptroller Thomas DiNapoli found that the average Wall Street salary amounted to $471,370 last year, nearly five times the average New York annual paycheck.
An earlier report by DiNapoli’s office released in March said the average bonus on Wall Street stood at $176,500 last year, drawing from a total pool of $33 billion.
He said that the financial industry is a fiscal lifeline for New York authorities.
Banks and their staffers contribute 27% of the state’s tax collections, or $28.8 billion, and 7% of the city’s total tax take, equivalent to 5.4% in revenue last year.