Morgan Stanley said to boost junior banker salaries by about 25%1 min read . Updated: 29 Jul 2014, 11:01 AM IST
The firm may raise salaries for associates and vice-presidents worldwide in investment banking and capital markets divisions
New York: Morgan Stanley is raising base salaries for junior bankers by about 25% as part of an effort to improve working conditions and retention, according to people briefed on the matter.
The firm is boosting salaries for associates and vice-presidents worldwide in its investment banking and capital markets divisions, according to the people, who asked not to be identified because the discussions weren’t public. Mark Lake, a spokesman for the New York-based bank, declined to comment.
Morgan Stanley’s move is intended to aid younger employees with their cash flow amid higher bonus deferrals since the financial crisis, said one of the people. The salary increases won’t necessarily mean a similar jump in bonuses.
Wall Street firms have been cutting hours for junior bankers as they seek to prevent defections to rivals such as private-equity funds. Investment banks including Credit Suisse Group AG and Bank of America Corp. have sought to improve working conditions for junior employees by encouraging them to take time off on weekends.
Morgan Stanley has also introduced time-management guidelines for junior and mid-level bankers, and has hosted internal conferences focused on career development, said one of the people.
The title of associate typically refers to employees who have worked for a couple of years or recently graduated from business school. The vice-president title is often earned after a few years as an associate.
Associates at the largest investment banks can earn base salaries of $85,000 to $180,000, according to New York-based recruitment firm Options Group Inc. Salaries for vice presidents can range from $120,000 to $250,000, according to Options Group. Bonuses take those figures even higher.
Total pay is usually determined at the end of a year. For 2013, Morgan Stanley deferred at least half of bonuses for any employee with total pay of at least $350,000 and incentive pay of $50,000, a person briefed on the policy said in January. Bloomberg