Top China share traders are set to enjoy the spoils from year-end payouts, while their Asia fixed income counterparts and dealmakers will miss out despite a record year for mergers in the region, headhunters and senior bankers said.
Banks, including UBS and HSBC, saw a boom year in Asia stock trading, sources at those firms and recruiters said, thanks to a China buying frenzy in the first half of 2015 that pushed the Shanghai Shenzhen CSI 300 index up 47 per cent from January to June.
Big payouts for China stock traders highlight the increasing divergence of bankers’ variable pay, as global firms distribute a bonus pool shrunk by fines and weaker revenues among a smaller number of standout performers each year.
Profits from the first-half China stock market rally were strong enough to outweigh trading losses and slower sales during a summer market crash, headhunters said.
The fixed income business, though, has struggled amid higher capital costs, turbulent markets, and uncertainty over US interest rate policy.
“Bonuses in Asia this year are going to be very polarised between equities and fixed income, even more so than last year,” said Sarah Harte, a director at headhunting firm Sheffield Haworth.
“Equities will be paid better than fixed income and some banks will have to pay up for those people who have performed over and above, and whom they cannot afford to lose,” she said.
Overall, bonuses in the equities investment banking business are expected to be broadly flat this year compared to 2014, as banks take a conservative position amid a gloomy outlook for 2016 due to the China downturn and regulatory costs, headhunters said .
Some Hong Kong-based China stock trading stars, however, can expect to receive 100 per cent bonuses, meaning a top-performing director on an annual base salary of $350,000 could earn as much again in annual bonus, recruiters said.
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