While 2020 was a year of rising junior salaries in banking, less attention was paid to seniors. Or, in the regulatory lingo, “material risk takers”. Material risk takers are employees who manage large teams or who are responsible for significant risk functions that can have a material impact on the bank. They are typically, but not necessarily, managing directors (MDs). Every year, banks operating in London must report on the compensation those material risk takers receive and break down the cash and stock bonus components of their pay.
The reports are typically filed a year after the payments have been made and we have compiled the below 2020 stats from five major banks operating in London. J.P. Morgan and Morgan Stanley, on average, paid more than Citi, Goldman and Bank of America. The two Morgans also paid the highest average bonus to material risk takers with a large portion in stock options (77% for J.P., 78% for Stanley).
While it wasn’t a massive year for luring senior talent with cash (J.P. Morgan, Bank of America and Citi all paid no signing bonuses during 2020), there were some large severance payments including J.P. Morgan awarding $3.57m to one employee and Bank of America paying a total $6.77m to seven material risk takers.
Salaries and bonuses at Goldman Sachs Group UK (in 2020)
Number of regulated staff in 2020: There were 558 material risk takers at Goldman Sachs in IBD, MBD, Global Markets and GIR.
Average salary (fixed remuneration) paid to each member of those UK regulated staff in 2020: $700k
Average cash bonus paid to each member of those UK regulated staff in 2020: $151k
Average stock bonus paid to each member of those UK regulated staff in 2020 (based on year-end Goldman Sachs share price): $597k
Average total compensation per member of those UK regulated staff in 2020: $1.45m (up from $1.1m in 2019).
Total value of sign-on bonuses paid during 2020:Goldman Sachs International made eight sign-on payments to material risk takers in 2020, worth a combined $2.5m. The highest individual award was $840k. Six material risk takers were awarded severance pay in 2020, worth a combined $860k. The highest individual severance was $550k.
Distribution of compensation among staff earning more than €1m at Goldman Sachs in 2020:
Ten employees earned more than €9m at Goldman in 2020, down from eleven in 2019.
Source: Goldman Sachs
Salaries and bonuses at J.P. Morgan in the UK (in 2020)
Number of regulated staff in 2020: There were 757 material risk takers in J.P. Morgan’s UK corporate and investment bank.
Average salary (fixed remuneration) paid to each member of those UK regulated staff in 2020: $756k
Average cash bonus paid to each member of those UK regulated staff in 2020: $196k (on average, $37k of this cash was deferred).
Average stock bonus paid to each member of those UK regulated staff in 2020: $652k (on average, $138k of this stock was upfront).
Average total compensation per member of those UK regulated staff in 2020: $1.60m (up from $1.40m in 2019).
Total value of sign-on bonuses paid during 2020: J.P. Morgan reported no sign-on payments to material risk takers in 2020. 23 material risk takers were awarded severance pay in 2020, worth a combined $14.56m. The highest individual severance was $3.57m.
Distribution of compensation among staff earning more than €1m at J.P. Morgan in 2020:
11 employees earned more than €6m at J.P. Morgan in 2020. 11 regulated employees earned over €5m at J.P. Morgan in 2019.
Source: J.P. Morgan
Salaries and bonuses at Bank of America UK (in 2020)
Number of regulated staff in 2020: There were 446 material risk takers in Global Banking and Markets.
Average salary (fixed remuneration) paid to each member of those UK regulated staff in 2020: $613k
Average cash bonus paid to each member of those UK regulated staff in 2020: $51k
Average stock bonus paid to each member of those UK regulated staff in 2020: $379k (on average, $27k of this stock was upfront).
Average total compensation per member of those UK regulated staff in 2020: $1.04m (up from $1.0m in 2019).
Total value of sign-on bonuses paid during 2020: Bank of America made no sign-on payments to material risk takers in 2020. Seven material risk takers were awarded severance pay in 2020, worth a combined $6.77m.
Distribution of compensation among staff earning more than €1m at Bank of America in 2020:
Seven employees earned more than €5m at Bank of America in 2020, down from four in 2019.
Source: Bank of America
Salaries and bonuses at Citigroup Global Markets (in 2020)
Number of regulated staff in 2020: There were 503 material risk takers in Citigroup’s Investment Banking division.
Average salary (fixed remuneration) paid to each member of those UK regulated staff in 2020: $663k
Average cash bonus paid to each member of those UK regulated staff in 2020: $391k (on average, $266k of this cash was deferred).
Average stock bonus paid to each member of those UK regulated staff in 2020: $430k (on average, $118k of this stock bonus was upfront).
Average total compensation per member of those UK regulated staff in 2020: $1.48m (up from $1.3m in 2019).
Total value of sign-on bonuses paid during 2020: Citigroup Global Markets made no sign-on payments to material risk takers in 2020, although they did give two employees guaranteed bonuses totalling $7.38m. 16 material risk takers were awarded severance pay in 2020, worth a combined $3.96m.
Distribution of compensation among staff earning more than €1m at Citigroup Global Markets in 2020:
Three employees earned more than €10m at Citigroup Global Markets in 2020, the same number as in 2019.
Source: Citigroup
Salaries and bonuses at Morgan Stanley UK (in 2020)
Number of regulated staff in 2020: There were 360 material risk takers in Morgan Stanley’s Institutional Securities Group (Sales and Trading).
Average salary (fixed remuneration) paid to each member of those UK regulated staff in 2020: $723k
Average cash bonus paid to each member of those UK regulated staff in 2020: $207k
Average stock bonus paid to each member of those UK regulated staff in 2020: $739k
Average total compensation per member of those UK regulated staff in 2020: $1.67m (down from $1.80m in 2019).
Total value of sign-on bonuses paid during 2020: Morgan Stanley’s Institutional Securities Group made eight sign-on payments to material risk takers in 2020, worth a combined $6.70m. 16 material risk takers were awarded severance pay in 2020, worth a combined $3.96m. The highest individual severance was $820k.
Distribution of compensation among staff earning more than €1m at Morgan Stanley in 2020:
Ten employees earned more than €7m at Morgan Stanley’s Institutional Securities Group in 2020, up from 7 in 2019.
Source: Morgan Stanley
