Asia’s top bankers see up to 50 per cent in pay cuts as financing deals run dry

Top bankers in Asia ex-Japan at Wall Street’s biggest firms are having their worst payouts since the financial crisis more than a decade ago, according to people familiar with the matter.

On average, managing directors at banks including Goldman Sachs, Morgan Stanley and Bank of America have seen their total compensation drop by 40 per cent to 50 per cent, with payouts for senior managing directors falling to between US$800,000 to US$1.5 million and for first-year MDs to US$600,000 to US$1 million, the people said, asking not to be named discussing internal matters.

Star bankers are suffering milder cuts of 20 per cent or less in their compensation after a bumper year in 2021, with a few still taking home around US$2 million. Non-performers are seeing reductions of 60 per cent to 70 per cent, with many being left out all together from the bonus pool. The figures reflect broad trends across major Wall Street firms in Asia, the people said. Pay may differ for certain product groups and countries.

Global investment banks are now pushing hard to keep a lid on costs after increasing their staffing over the past few years in a war for talent and higher inflation. While Asia has been their biggest growth markets for years, job cuts have proliferated and the tough bonus news is expected to help reduce headcount further.

Goldman plans to slash 3,200 jobs globally and has already made two rounds of reductions in Asia since September, firing mostly China-focused bankers. Morgan Stanley has also jettisoned bankers focused on China.