Compared to last year, Credit Suisse’s Australian bankers anticipated bonus cuts to about 35% to 40% as the bank attends to broader restructuring.
After two years of active transacting, as the capital markets and dealmaking in M&A comes to a standstill, Wall Street’s largest funders from the US to Europe are bracing their banking staff for a sharp cut on bonuses and layoffs for the upcoming months.
Steering away from the scandals that led billion dollar losses in the past year, inviting doubts about their proficiency at risk management and pushing hundreds of bankers towards quitting, Credit Suisse now focuses on bonus reductions, which are to be declared in March.
People familiar with conversations around this subject in New York and Australia said that although Australian bankers are prepared for cuts on their remuneration, their equals in major geographical regions like the Asia-Pacific and the US may witness bonus cuts that go lower since the investment banking revenue in these regions were impacted with a severe slump.
According to Refinitiv data, their investment banking and capital markets team in Australia pulled in $4.5 billion as fees last year, which fell by 10% compared to 2021. However, despite the decline, the fee count secured in the previous year stood second-highest in Australia’s investment banking sector after 2009.
However, the fees have been reduced globally by 36% since 2021, while the same in America fell by 42% due to the unstable stock market, increasing borrowing costs, poor company valuations, and lagging M&A activity.
Australia’s sturdy performance in relevance to its peers overseas has sent many local bankers scoffing about the cut in their bonus pool.
One of the country’s representatives said that he was “pretty miserable” anticipating such cuts, while another felt anguished for the impact the bankers’ wallets would undergo; however, he understood that bonuses are inevitably linked to global activities.
- Published By Team Australia News