Key Takeaways
- Wall Street bonuses could be set to rise this year, according to a report from compensation consulting firm Johnson Associates.
- The projected growth follows strong performance from markets, a rebound in IPOs, and signs of investors showing greater risk tolerance, among other factors.
- Compared to other professionals in financial services, debt and equity underwriters could see the biggest jump as deals rebound, the report said.
Wall Street bonuses could be set to rise this year, with debt and equity underwriters likely to see the biggest boosts as deals rebound, according to a report from compensation consulting firm Johnson Associates.
The projected gains come after a lackluster two years for bonuses in financial services, with little to no growth for many professionals after end-of-year incentives exploded in the low-interest-rate environment of 2021 with strong client demand and record activity in the market for initial public offerings (IPOs).
IPO Market Rebound, Greater Risk Tolerance Help Drive Projections Higher
The projected growth follows strong performance from markets in the first half of the year, a rebound in IPO activity, and signs of investors showing greater risk tolerance, among other factors.
Compared to other professionals in financial services, debt underwriters could see the biggest bonus growth of up to 35% this year, the report said, followed by equity underwriters at 30%.
After underwriters, hedge fund, equity sales and firm management professionals could see bonus growth of up to 15%, thanks to strong performance across business segments and investors’ willingness to take on additional risk.
Meanwhile, the retail and commercial sector could see incentives stay flat or fall amid a decline in commercial lending levels.