Merger advisers’ bonuses are likely to tumble this year as the business remains stagnant, though asset-management executives will see modest gains, according to Johnson Associates Inc.
(Bloomberg) — Merger advisers’ bonuses are likely to tumble this year as the business remains stagnant, though asset-management executives will see modest gains, according to Johnson Associates Inc.
Advisers on M&A transactions will probably see payouts slump as much as 25%, and any respite is unlikely until 2024, the compensation consultants said in a report Monday. Traders are also in for a disappointing round of payouts, with incentives dropping as much as 10%. But certain fixed-income businesses are likely to outperform, according to the report.
Despite the mostly pessimistic assessment elsewhere, “wealth management outshines other business segments on new clients and rising markets,” the New York-based consultancy said.
Traditional asset management firms will see flat incentives despite a surge in equities as passive funds and lower-fee products gain market share. The firms’ response has been to slow hiring and cut headcount to protect their margins, according to Johnson Associates.
Bonuses will probably fare better among alternative-investment firms, where hedge fund bonuses are trending flat to up moderately. The private equity outlook is little changed from last year amid difficult fundraising, according to the report.
Executives in underwriting should expect bonuses flat to down as much as 10%, though equity underwriting has been gaining momentum, according to the report.
Read More: The Great M&A Slump Is Shaking Up Giants of Investment Banking
(Updates with underwriting bonuses in last paragraph. A previous version of this story corrected date of report in second paragraph.)
More stories like this are available on bloomberg.com
©2023 Bloomberg L.P.